Republic Services and Allied Waste shareholders show green signal to merger
Republic Services and Allied Waste Industries shareholders have finally approved the proposed merger of the two, creating the second-largest trash-hauling company in the country.
Post acquisition, Allied Waste will become a wholly owned subsidiary of Republic Services. Under the arrangement, Allied stockholders will keep about 51.7 percent of the outstanding common stock of the combined company in respect of their Allied shares and Republic stockholders will keep about 48.3 percent of the outstanding common stock of the combined company - in each case, on a diluted basis.
When in June, the shareholders approved Republic Services' purchase of Allied Waste in an all-stock deal, it was valued at $6.07 billion.
Now the company is worth $5 billion due to the steep fall in share value. According to market experts, the combination of the two companies i. e Fort Lauderdale-based Republic and Scottsdale, Arizona-based Allied will create a $9.24 billion rival to industry leader Waste Management Inc., which reported revenue of $13.31 billion in 2007.
The companies said that they expect the transaction to close by the end of the year, subject to regulatory approval. Republic shares ended the day on Friday at $ 24.70, down 4% compared to previous close. While Allied Waste scrip settled the day, down 3.5% at $10.93.
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