Waste Management raises Republic Services offer

Source: Exec Digital USA

Date :8/11/2008 10:17:45 AM

Waste Management Inc, the largest North American trash hauler, has raised its unsolicited offer for Republic Services Inc by 8.8 percent to US$6.73 billion.

The move was to try and halt the smaller rival’s plan to buy Allied Waste Industries Inc.

The bid was increased to US$37 a share in cash from a July 14 offer of US$34 a share, Waste Management said today. The new bid is 6.1 percent higher than Republic’s closing share price on August 8.

Waste Management head David Steiner is increasing an offer that Republic CEO James O’Connor has criticized as an “opportunistic” effort to impede its merger with Allied, which was announced in June. The takeover battle is playing out as slowing US construction and higher fuel costs challenge the companies’ profitability.

“We believe our proposal is clearly superior for Republic’s stockholders,” Steiner said in today’s statement.

Waste Management’s new offer includes an agreement to pay US$250 million if the Government blocks the merger on antitrust grounds and an “interest component” that increases the price paid to Republic shareholders if the deal takes longer than expected to complete.

Republic, the third-largest trash mover in North America, agreed on June 23 to buy Allied Waste for about US$6.1 billion.