GFL sells a stake in GIP

MORRISBURG – A major infrastructure company, with offices in South Dundas, has seen a major shareholder sell a stake in the company.

Green Infrastructure Partners, which bought Coco Paving (formerly Cruickshank Construction) in 2022, entered into an agreement with Energy Capital Partners August 7 to recapitalize the company.

GFL Environmental, which also has operations in South Dundas via its former Third High Farms bio-solids division in Iroquois, reduced its stake in GIP to 30 per cent with the recapitalization. GFL will see about $200 million from the proceeds of the recapitalization.

“This transaction allows GFL to monetize part of our position in GIP in a tax efficient manner, while still retaining a meaningful equity interest that will allow us to participate in what we expect to be continued value creation from the GIP business,” said Patrick Dovigi, founder and chief executive officer of GFL. Dovigi said the funds will be used for general corporate purposes including business growth and “pursuing opportunistic share buybacks.”

GIP was spun off into a separate entity by GFL in 2022 in partnership with HPS Investment Partners and GFL founder Dovigi. The company claims the recapitalization increases the value of GIP to $4.25 billion.

“Over the years, I have re-iterated my belief that we could create $1.0 billion of value for GFL shareholders through our investment in GIP. Our original investment of approximately $250.0 million in 2022 has grown to approximately $1.1 billion in just over three years,” Dovigi said.

Drew Brown, a partner at ECP, said the transaction will provide GIP access to capital.

“With two decades of investing in North American infrastructure, ECP is well-equipped to act as a value-add partner with GIP,” Brown said.

The financial transaction will have no impact on employment levels at either company.

GFL is based in Vaughan, ON and is the fourth-largest environmental services company in North America. It has significant operations in SDG Counties including its Moose Creek Landfill in North Stormont. GIP is a civil engineering company based in Markham, ON and has over 3,000 employees.