January 25, 2022

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Justice Department Requires Waste Management To Divest Assets In Order To Proceed With Advanced Disposal Services Acquisition

19 min read
<div>The Department of Justice announced today that Waste Management, Inc. (WMI) will be required to divest 15 landfills, 37 transfer stations, 29 hauling locations, over 200 waste collection routes, and other assets in order to proceed with its $4.6 billion acquisition of Advanced Disposal Services, Inc. (ADS).  The department said that without the divestiture, the proposed acquisition would substantially lessen competition for small container commercial waste collection or municipal solid waste disposal services in over 50 local markets.</div>

Divestiture Will Preserve Competition in Markets for Small Container Commercial Waste Collection and Municipal Solid Waste Disposal in Over 50 Local Markets in 10 States

The Department of Justice announced today that Waste Management, Inc. (WMI) will be required to divest 15 landfills, 37 transfer stations, 29 hauling locations, over 200 waste collection routes, and other assets in order to proceed with its $4.6 billion acquisition of Advanced Disposal Services, Inc. (ADS).  The department said that without the divestiture, the proposed acquisition would substantially lessen competition for small container commercial waste collection or municipal solid waste disposal services in over 50 local markets.

  The department’s Antitrust Division — along with five state Attorneys General — filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed transaction.  At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the complaint.  The participating state Attorneys General offices represent Florida, Illinois, Minnesota, Pennsylvania, and Wisconsin.

“Without divestitures, this merger would have harmed competition for essential waste collection and disposal services throughout the country,” said Assistant Attorney General Makan Delrahim.  “By requiring WMI and ADS to divest numerous facilities and assets in ten states, will ensure that businesses, municipalities, and towns continue to benefit from competition for these critical services.”

According to the complaint, WMI and ADS both supply small container commercial waste collection and municipal solid waste disposal services.  In each of the local markets alleged in the complaint, WMI and ADS compete vigorously against each other and are either the only two or two of only a few significant providers of one or both of these essential services.  The combination of the two companies would eliminate head-to-head competition between them and threaten the lower prices and better service that customers have realized from that competition. 

Under the terms of the proposed settlement, WMI and ADS must divest assets covering over 50 local markets including landfills, transfer stations, hauling locations, and waste collection routes to GFL Environmental Inc., or to an alternate acquirer approved by the United States.  GFL, based in Ontario, Canada, is a provider of small container commercial waste collection and MSW disposal in local markets in Canada and the Unites States.

WMI, a Delaware corporation, headquartered in Houston, Texas, had total revenues of over $15 billion in 2019. 

ADS, a Delaware corporation headquartered in Jacksonville, Florida, had total revenues of over $1.6 billion in 2019. 

As required by the Tunney Act, the proposed consent decree, along with a competitive impact statement, will be published in the Federal Register.  Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Katrina Rouse, Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530.  At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the final judgment upon a finding that it serves the public interest.

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