Meridian Waste Solutions Executes Agreement to Sell its Solid Waste Management Assets
February 20 2018 - 9:21AM
Meridian Waste Solutions, Inc. (NASDAQ: MRDN) (“Meridian” or the
“Company”), an innovative technology company, today announced its
execution of a definitive agreement to sell the equity interest of
its wholly-owned subsidiaries that house its Solid Waste Group to
Warren Equity Partners Fund II in exchange for approximately $87
million in debt assumption and $3 million in cash.
Plan to Reduce Indebtedness and Focus Growth
Areas Meridian’s business has historically been comprised of
its solid waste collection, transfer and disposal services.
However, the Company recently began to shift its focus to growth of
its innovative technology units, including biomass, and healthcare
technology services, within which the Company has identified
several compelling additional acquisition opportunities for value
creation at rates that are disproportionately greater than the
Company’s solid waste business.
While the solid waste business has driven much
of the Company’s growth to date, the associated debt burden
(approximately $95 million), the liquidity required to service that
debt (approximately $11 million per year), and the substantial
capital expenditure needs of the business, restrict the Company’s
ability to allocate capital to new and more profitable
initiatives.
“We were able to scale and grow our solid waste
unit very rapidly, but the associated debt burden and cash needs
were a bottleneck in restricting our access to cost-effective
sources of growth capital,” said Jeff Cosman, the Company’s Chief
Executive Officer. “Thus we developed a strategic plan to reduce
debt and improve margins and liquidity in ways that are accretive
to the Company’s value, thereby enabling the Company to access and
use more growth capital at improved rates of return. The removal of
this debt and capital needs provides us the flexibility to pursue
higher growth opportunities to grow at a much faster pace in our
innovative technology, biomass and technology groups.”
Moving Forward “After closing on the sale
of our solid waste group, we intend to re-brand the public company
as Attis Industries, Inc. and currently believe that our remaining
assets can generate approximately $3 million in pre-tax earnings
(versus previous years of net losses) in 2018, or approximately
$0.15 per common share,” continued Cosman. “We also believe that
reducing our debt load by more than 90% paves the way for us to
aggressively pursue several acquisitions that we’re currently
evaluating. We believe that by removing this debt bottleneck,
we are placing ourselves in a much stronger position for all of our
stakeholders, including our shareholders.”
About Meridian Waste Solutions,
Inc.Meridian Waste Solutions, Inc. (NASDAQ: MRDN) is a company
defined by our commitment to servicing our customers with
unwavering respect, fairness and care. We are focused on finding
and implementing solutions for the resource needs and challenges of
our customers with a fundamental objective to seek rewarding
solutions through technology and innovation. Our healthcare
division centers on creating community-based synergies through
collaborations and software solutions. Our innovation division
(www.attisinnovations.com) strives to create value from recovered
resources. For more information, visit www.mwsinc.com.
Forward-Looking StatementsAny statements
contained in this press release that do not describe historical
facts may constitute forward-looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995.
You can identify forward-looking statements by words such as
“anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,”
“may,” “plan,” “should,” “would” or similar words. You should
consider these statements carefully because they discuss our plans,
targets, strategies, prospects and expectations concerning our
business, operating results, financial condition and other similar
matters. These statements are subject to certain risks,
uncertainties, and assumptions, including, but not limited to,
risks and uncertainties relating to the Company's ability to
develop, market and sell products based on its technology; the
expected benefits and efficacy of the Company's products and
technology; the availability of substantial additional funding for
the Company to continue its operations and to conduct research and
development, clinical studies and future product commercialization;
and, the Company's business, research, product development,
regulatory approval, marketing and distribution plans and
strategies, the requirement to satisfy closing conditions to the
solid waste business transaction (the “Transaction”) as set forth
in the purchase agreement, including the outcome of any legal
proceedings that may be instituted against seller parties and
others related to the transaction; the ability to retain certain
key employees of Meridian; the ability of Meridian to manage and
pay its current debt service and meet its liquidity needs,
including paying amounts due under the its current credit facility
and Meridian’s other debt obligations; the consequences of a
termination of the purchase agreement for the Transaction,
including the ability of Meridian to pay any amounts due related to
the termination fee and/or buyer’s expenses; the ability of
Meridian to continue to meet the listing requirements of NASDAQ;
the ability of Meridian to execute on a business plan that permits
the technologies and innovations businesses to provide sufficient
growth, revenue, liquidity and cash flows for sustaining Meridian’s
go-forward business, including but not limited to Meridian’s
ability to service any debt that remains as part of obligations of
Meridian related to its credit agreement after the closing under
the purchase agreement, the risk associated with the buyer’s rights
to termination under the purchase agreement, including but not
limited to is financing condition and its rights to continued due
diligence; the risk related to any claims for indemnification under
the purchase agreement and the risks identified and discussed
under the caption “Risk Factors” in the Meridian Annual Report on
Form 10-K for the fiscal year ended December 31, 2016, filed with
the Securities and Exchange Commission (the “SEC”) on April 17,
2017 and amended on May 31, 2017 and the other documents Meridian
files with the SEC from time to time. There will be events in the
future, however, that Meridian is not able to predict accurately or
control. Meridian’s actual results may differ materially from the
expectations that Meridian describes in its forward-looking
statements. Factors or events that could cause Meridian’s actual
results to materially differ may emerge from time to time, and it
is not possible for Meridian to accurately predict all of them. Any
forward-looking statement made by Meridian in this press release
speaks only as of the date on which Meridian makes it. Meridian
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
Media and Investors Contact:
Hayden IR
ir@meridianwastesolutions.com
(917) 658-7878
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