Stericycle, Inc. announces that it has entered into a definitive agreement to sell its Domestic Environmental Solutions business, excluding the healthcare customer and unused consumer pharmaceutical take-back services, to Harsco Corporation for $462.5 million in cash, subject to customary adjustments set forth in the agreement.
The transaction includes Stericycle’s Domestic Environmental Solutions business including Manufacturing and Industrial Services and the retail portion of Hazardous Waste Services, which together employ approximately 2,000 team members across 61 facilities. Stericycle will continue to offer solutions for unused consumer pharmaceutical take-back services and provide hazardous waste services to healthcare customers. Harsco will provide transportation and disposal services to healthcare customers under a long-term service agreement to be entered into at the closing of the transaction.
“The sale of the Domestic Environmental Solutions business demonstrates important progress in our transformation as we improve margin percentages, reduce debt, enhance our balance sheet flexibility, and drive long-term shareholder value,” said Cindy J. Miller, Chief Executive Officer of Stericycle. “As a focused provider of environmental solutions in the U.S., Harsco is well-positioned to drive this business forward, and we are confident this transaction is in the best interest of Stericycle and our shareholders, our customers and team members. We thank our team members and customers for their continued support, and we look forward to working closely with Harsco to ensure a smooth transition.”
The transaction, which is subject to customary closing conditions and regulatory approvals and is expected to close in the first quarter of 2020, will not impact the operations of Stericycle’s regulated medical waste and secure information destruction businesses. Stericycle intends to use net proceeds from the divestiture to pay down outstanding debt.
Stericycle today also announced that it completed the sale of its operations in Chile in December to an affiliate of Veolia for approximately $30.7 million. This transaction is subject to customary post-closing covenants and indemnity obligations. The divestiture of the company’s Chilean operations marks the fifth divestiture executed by Stericycle during 2019. Over the course of the year, Stericycle also sold a texting business based in the UK, a telephone answering services business in North America, a pharmaceutical returns business, and substantially all its operations in Mexico. The five transactions combined generated approximately $83.7 million in gross proceeds during 2019.
Miller continued, “Beyond our portfolio rationalization efforts, our team is focused on driving revenue quality and improving operational efficiencies across our business as well as the implementation of our global ERP system. As we continue to make progress on these initiatives, we remain committed to deepening our value proposition for clients with differentiated services and enhancing value for Stericycle shareholders.”