Toxfree grows presence around Australia with acquisitions and contract wins
Toxfree Solutions has continued its rapid growth throughout Australia with this year’s acquisition of liquid waste and industrial services company, Worth Corporation, for $70 million.
Worth Corporation, which operates in Sydney, the Illawarra and the Hunter Valley, has two major industrial waste treatment plants. The New South Wales-based company undertakes the collection, transportation, processing and recycling of liquids, sludge and contaminated soils, as well as providing confined space services, industrial cleaning and non-destructive digging.
Toxfree managing director Steve Gostlow says the acquisition of Worth provides an ideal opportunity to firmly establish the company in the NSW market.
“NSW is Australia’s fastest growing economy with a pipeline of future opportunities. This acquisition will make Toxfree a truly national company and further diversifies our business across end-market segments, geographies and services,” Gostlow says.
He adds that Worth’s EPA licensed facilities create a perfect platform for growth.
“The facilities would be very difficult to replicate and will provide a strategic advantage in winning new business in both liquid and solid waste treatment,” Gostlow says. “The integration of the Worth and Toxfree businesses in NSW will provide new opportunities for both Toxfree and Worth employees.”
Toxfree, which is based in Western Australia, funded the acquisition through debt, as well as a $20 million placement and $4 million share purchase plan. Worth is centrally controlled from its Sans Souci head office and has 130 employees, including three senior managers and 60 drivers.
Over the past three years Worth developed a 15,000 square metre, EPA licensed, industrial waste and chemical immobilisation treatment facility at St Marys, which is approved for the treatment of up to 100,000 tonnes of hazardous waste.
Worth also operates an industrial services depot in Kurri Kurri, Hunter Valley, on-site liquid treatment facilities at Tahmoor coal mine and truck depots.
Other benefits of the acquisition for Toxfree include: Worth’s clients are in commercial and industrial sectors where Toxfree expects to leverage its expertise in hazardous and industrial services; expansion and diversification of the company’s earnings base, both in terms of geography and service; and, Worth is a profitable business with strong operating margins, as well as the potential to extract cost synergies and higher return on invested capital consistent with its technical and environmental services division.
The acquisition of Worth adds to an active start to 2016 for Toxfree, following the award of a contract for BHP Billiton’s Olympic Dam operations in South Australia, and the extension of an existing contract with Chevron at Barrow Island in Western Australia.
In February, Toxfree was awarded the five-year contract with BHP Billiton at Olympic Dam, which is located 560 kilometres north of Adelaide and is Australia’s largest underground mine.
Starting in June 2016, the contract scope includes management of all wastes generated from mining operations, industrial cleaning and quarantine services, landfill management and recycling services.
Gostlow says Toxfree’s core strategy is focused on providing integrated industrial service and waste management solutions for clients like BHP Billiton.
“Toxfree continues to remain focussed on organic growth opportunities through award of total waste management and industrial service contracts with blue chip clients throughout Australia. Our contract pipeline remains strong with over $80 million of contracts,” Gostlow says.
Toxfree also signed a two-year contract extension of the contract with Chevron in February, extending the agreement until 2021.