| Casella Waste Systems, Inc. | |||
| Ticker: | CWST | 25 Greens Hill Lane | |
| Exchange: | NASDAQ-National Market | Rutland, VT 05701 | |
| Industry: | Utilities (SIC Code 4953) | (802) 775-0325 | |
| # of Employees: | 825 | ||
| Type of Shares: | Class A Common Shares | Filing Date: | 8/7/97 | |
| U.S. Shares: | 4,000,000 | Offer Date: | 10/28/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $17.00 - $19.00 | |
| Primary Shares: | 3,000,000 | Offer Price: | $18.00 | |
| Secondary Shares: | 1,000,000 | Gross Spread: | $1.26 | |
| Offering Amount: | $72,000,000 | Selling: | $0.74 | |
| Expenses: | $1,000,000 | Reallowance: | $0.10 | |
| Shares Out After: | - |
| Manager | Tier | Phone |
| Goldman, Sachs & Co. | Lead Manager | (212) 902-5959 |
| Donaldson, Lufkin & Jenrette Securities Corp. | Co-manager | (212) 371-0641 |
| Oppenheimer & Company, Inc. | Co-manager | (212) 667-7400 |
| Issuer's Law Firm: | Hale and Dorr |
| Bank's Law Firm: | Morrison Cohen Singer & Weinstein |
| Auditor: | Arthur Andersen |
| Registrar/Transfer Agent: | Boston Equiserve Limited Partnership |
Dollar amounts in U.S. millions except for per share data | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 4/30/97 | 4/30/97 | ||||
| Revenue: | $38.11 | Assets: | $133.11 | ||
| Net Income: | -$0.01 | Curr Assets: | $18.26 | ||
| EPS: | Liabilities: | $104.96 | |||
| Prior EPS: | Curr Liabilities: | $22.96 | |||
| Cash Flow/Oper: | $14.73 | Equity: | $28.15 | ||
| Cash Flow/Fin: | Cash: | $1.42 | |||
| Cash Flow/Inv: | Working Cap: | -$4.71 | |||
| Business Description |
| The company is a regional, integrated, non-hazardous solid waste services company that provides collection, transfer, disposal and recycling services in Vermont, New Hampshire, Maine, upstate New York and northern Pennsylvania. As of June 30, 1997, the Company owned and/or operated four Subtitle D landfills, 31 transfer stations, eight recycling processing facilities, and 22 collection operations which together served over 68,000 commercial, industrial and residential customers. The Company was founded in 1975 as a single-truck operation in Rutland, Vermont and subsequently expanded its operations throughout the state of Vermont. In 1993, the Company initiated an acquisition strategy to take advantage of anticipated reductions in available landfill capacity in Vermont and surrounding states due to increasing environmental regulation and other market forces driving consolidation in the solid waste industry. From May 1, 1994 through April 30, 1997, the Company acquired ownership or long-term operating rights to 44 solid waste businesses, including four landfills, and, between May 1, 1997 and August 1, 1997, the Company acquired an additional eight such businesses. The Company believes that additional acquisition opportunities exist in the markets it serves and in other prospective markets. |
| Competition |
| The solid waste management industry is highly competitive, fragmented, and requires substantial labor and capital resources. The Company competes with numerous solid waste management companies, many of which are significantly larger and have greater access to capital and greater financial, marketing or technical resources than the Company. Certain of the Company's competitors are large national companies that may be able to achieve greater economies of scale than the Company. The Company also competes with a number of regional and local companies. In addition, the Company competes with operators of alternative disposal facilities, including incinerators, and with certain municipalities, counties and districts that operate their own solid waste collection and disposal facilities. Public sector facilities may have certain advantages over the Company due to the availability of user fees, charges or tax revenues and the greater availability to them of tax-exempt financing. In addition, recycling and other waste reduction programs may reduce the volume of waste deposited in landfills. The Company competes for collection and disposal volume primarily on the basis of the price and quality of its services. From time to time, competitors may reduce the price of their services in an effort to expand market share or to win a competitively bid municipal contract. These practices may also lead to reduced pricing for the Company's services or the loss of business. Competition exists within the industry not only for collection, transportation and disposal volume, but also for acquisition candidates. The Company generally competes for acquisition candidates with publicly owned regional and national waste management companies. |
| Business Plan |
| The Company's objective is to continue to grow by expanding its services in markets where it can be one of the largest and most profitable fully-integrated solid waste services companies. The Company is currently operating in Vermont, New Hampshire, Maine, upstate New York and northern Pennsylvania, and believes that these markets and other markets with similar characteristics present significant opportunities for achieving its objectives. The Company focuses its efforts on markets which are characterized by: (i) a geographically dispersed population; (ii) disposal capacity which the Company anticipates may be available for acquisition by the Company; (iii) significant environmental regulation which has resulted in a decrease in the total number of operating landfills; and (iv) a lack of significant competition from other well-capitalized and established waste management companies. The Company believes that these characteristics result in significant market opportunities for the first fully-integrated, well-capitalized market entrant, and create economic and regulatory barriers to entry by additional competitors in these markets. The Company's strategy for achieving its objective is: (i) to acquire solid waste collection businesses and disposal capacity in new markets, and to make "tuck-in" acquisitions in existing markets; (ii) to generate internal growth through increased sales penetration and the marketing of upgraded services to existing customers; and (iii) to implement operating enhancements and efficiencies. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for reduction of existing indebtedness and redemption of Series C Preferred Stock, acquisitions and other general corporate purposes. |
| Name of Shareholder | % Owned Before | % Owned After |
| BCI Growth III, L.P. | 24.80% | |
| Norwest Equity Partners | 12.40% | |
| Weston Presidio Capital II, L.P. | 11.80% | |
| Michael F. Cronin | 11.70% | |
| John W. Casella | 10.50% | |
| Douglas R. Casella | 10.50% | |
| Kenneth H. Mead | 9.60% | |
| North Atlantic Venture Fund, L.P. and The Vermont Venture Capital Fund, L.P | 7.80% | |
| Gregory B. Peters | 7.80% | |
| James W. Bohlig | 6.30% | |
| National Waste Industries, Inc. | 5.30% | |
| C. Andrew Russell | 5.30% |
| Officer Name | Title | Age |
| John W. Casella | President, Chief Executive Officer, Chairman of the Board of Directors and Secretary | 46 |
| Patrick J. Strauch | Regional Vice President | 39 |
| Michael Holmes | Regional Vice President | 42 |
| Alan N. Sabino | Regional Vice President | 37 |
| James W. Bohlig | Senior Vice President and Chief Operating Officer, Director | 51 |
| Douglas R. Casella | Vice Chairman of the Board of Directors | 41 |
| Jerry S. Cifor | Vice President and Chief Financial Officer, Treasurer | 36 |
| Michael J. Viani | Vice President, Business Development | 42 |
| Joseph S. Fusco | Vice President, Communications | 33 |
| Gary Simmons | Vice President, Fleet Management | 47 |
| Robert G. Banifield, Jr. | Vice President, Hauling Operations | 35 |
| Larry B. Lackey | Vice President, Permits, Compliance and Engineering | 36 |
| Christopher M. DesRoches | Vice President, Sales and Marketing | 39 |
| Michael P. Barrett | Vice President, Transportation and Recycling | 43 |