Veolia, the French water and sewage giant with R&D labs in Trevose, has agreed to pay $3 billion for Philadelphia-based Enviri’s Clean Earth division, which treats contaminated materials for big manufacturers.
Clean Earth, based in King of Prussia, serves manufacturers such as Boeing, Merck, computer-chip makers, and hospitals. Veolia operates local water utilities in towns across the U.S., including a slice of Delaware County and northern Delaware.
Clean Earth employs around 1,800, and already uses Veolia incinerators to burn hazardous medical waste and other refuse. Enviri bought that business for $625 million in 2019. Veolia says it plans to cut $120 million in spending as it integrates Clean Earth, to make the deal more profitable.
Combined with Veolia’s existing hazardous-waste business, Veolia says it will be among the largest businesses of its kind. Veolia also bought medical-waste companies in New England and California earlier this year, and it has incinerators in Texas, Illinois, and Arkansas.
Clean Earth includes tar-contaminated soil collection treatment centers on the Schuylkill in Southwest Philadelphia; in Morrisville, Bucks County; and New Castle, Del.; and a hazardous-waste and chemical disposal site in Hatfield, Montgomery County, among 82 waste-management and 19 federally-permitted treatment sites, along with hundreds of trucks. Veolia has industrial facilities in Bridesburg and Pennsauken, among other area locations.
Veolia will pay cash worth around $15.50 a share, or $1.3 billion, to Enviri shareholders for Clean Earth; plus $1.35 billion to pay down some of Enviri’s debt load; and around $400 million to help finance Enviri as it restructures as a smaller company and issues new shares. Both boards have approved the deal, pending a vote by Enviri shareholders next spring.
The price to shareholders is a premium to Enviri’s recent share value, and triple what it was worth at its recent low in March. But it’s also less than the stock was worth as recently as 2022, before the company changed its name from Harsco and moved from central Pennsylvania to Philadelphia, where its leaders said it’s easier to recruit engineers and managers.
The sale leaves Enviri with two remaining business lines: steel-mill slag management and railroad track equipment and maintenance. The latter business faces large environmental expenses, and Enviri had earlier tried to sell it.
After selling Clean Earth to Veolia and reducing management costs, Enviri will spin off the remaining businesses into a new company, under the same name.
Announcing the deal, Enviri chief executive F. Nicholas Grasberger also said he’ll be stepping down from the company’s top job, to be succeeded by Russell Hochman, a ten-year Enviri veteran who already serves as the company’s senior vice president, top lawyer, and compliance officer.
The restructured Enviri will have more cash to invest in its businesses and lower finance costs, Grasberger said in a statement. He praised successor Hochman’s “deep business acumen and proven ability to navigate mergers and acquisitions, regulatory matters, and transformation efforts.”
The boost in Enviri’s capital “will create enhanced opportunities” for both slag and rail, Hochman said in a statement.
