Waste Management Inc., the world's largest waste corporation has agreed
to be acquired by a smaller rival company, USA Waste Services,
the 3rd largest waste corporation.
In a stock deal valued at $13.5 billion, USA Waste's sales of $2.6 billion
would more than quadruple, making it twice as big as its nearest rival, Browning-Ferris Industries Corp.
The combined company, which will become the premier trash company in the
United States, will be named Waste Management. ''USA Waste is not a good name for a global company,
quipped Robert S. Miller, interim chairman of Waste Management who will be the nonexecutive chairman of the new company.
Officially the $20 billion stock-and-debt deal is being billed as a merger.
Shareholders of Oak Brook-based Waste Management will own 60 percent
of the combined company. But senior management will come from the USA Waste
side, and headquarters will be consolidated at that company's Houston site.
The merger will make Houston the undisputed solid waste capital of the United
States, as corporate headquarters of both the No. 1 (Waste Management) and
the No. 2 (Browning-Ferris) companies in the industry.
USA Waste also is assuming $7 billion of Waste Management debt as part of the
deal. Waste Management currently accounts for about 15 percent of the U.S.
trash hauling business, Drury said, while USA Waste has 5 percent.
Company officials said they do not expect antitrust problems since 80
percent of the market would still be open.
Waste Management Headquarters: Oak Brook, IllinoiS
Employees: 58,800 worldwide (37,000 in U.S.)
1997 Revenues: $9.2 billion
1997 earnings: $1.18 billion loss
Established: 1971 Chairman/CEO: John E. Drury
USA Waste Services Headquarters: Houston, Texas
Employees: 17,700 *
1997 Revenues: $2.6 billion
1997 earnings: $267 million
Established: 1987 Acting Chairman/CEO: Robert Stevens Miller Jr.
COMBINED ASSETS - NORTH AMERICA
Landfills:
USA Waste 182 Waste Management 137
Total 319
Collection Operations:
USA Waste 250 Waste Management 400
Total 650
Transfer Stations:
USA Waste 175 Waste Management 164
Total 339
