Browning-Ferris to Sell Overseas Operations to Sita
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Browning-Ferris Industries Inc. agreed to sell its overseas operations to a Suez Lyonnaise des Eaux unit for $1.45 billion, dropping once-aggressive international expansion plans to focus on North America. The Houston-based waste collection company said it will receive $1 billion in cash and a 20% stake in Sita, which will become the world’s third-largest trash hauler. Sita is 64% owned by Paris-based Lyonnaise des Eaux.
The sale marks a significant retreat by Browning-Ferris from its plans to build through international expansion. Only three years ago, the second-largest U.S. trash hauler won a hard-fought battle to acquire Britain-based Attwoods for $610 million.
“They have not been able to duplicate the strength they have achieved domestically overseas,” said Marc Sulam, an analyst with Donaldson Lufkin & Jenrette.
Besides operating a fleet of trucks to collect trash, Browning-Ferris also operates landfills, recycling facilities and medical-waste treatment facilities. It’s also the world’s second-largest waste collection company after Waste Management Inc.
Sita has similar businesses, with industrial and commercial waste collection services, recycling, landfills and urban and industrial sanitation services.
Browning-Ferris said it will use the cash to buy back shares and reduce debt. The company announced plans to buy back $1 billion of its stock in September and acquired $585 million in stock Oct. 1.
Browning-Ferris stock rose 81 cents to close at $35.19 on the New York Stock Exchange.
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