LEXPERT MAGAZINE
|
SEPTEMBER
/
OCTOBER 2018 9
Lexpert: GFL had been pursuing an IPO
before the deal's April announcement.
Why was a private partner the way to go?
JOY GRAHEK, General Counsel, GFL Environ-
mental: At GFL, we are always considering
our strategic alternatives to find the right
capital structure to support the growth of
the business. … Ultimately, BC Partners,
Ontario Teachers' Pension Plan and their
consortium presented a more compelling
opportunity for GFL at this stage in its
growth plans.
Lexpert: Can you describe about how this
deal came about?
GRAHEK: GFL's experience with its private
market partners has to date proved to be
the more strategic alternative [to a pub-
lic market transaction] at each successive
stage of our plan. It was important to us to
find partners that shared GFL's principles,
values and vision, and that had significant
capital to contribute to our ambitious
growth plans. BC Partners and their con-
sortium ticked all the boxes for us without
having to sacrifice value.
SHAHIR GUINDI, Osler, Hoskin & Harcourt LLP
(for investors led by BC Partners and OTPP):
When GFL was considering its options, it
had the opportunity to meet the team at BC
Partners. Both parties felt that a relation-
ship would be compelling, and in light of
market dynamics and the shareholders that
were interested, BC partners was ultimate-
ly selected. e recapitalization allowed
the company to stay private, continue to
grow in the private markets and continue
to develop its strategy and be more nimble
outside of the public eye. Essentially, it was
able to focus on the core business rather
than everything else that is required for a
public company. It also let them partner up
with others that will accelerate the growth
and development of the company.
Lexpert: More specifically, I understand
that this was BC Partners' first large Cana-
dian investment. Was the firm looking for
an entry into the waste management sector
in particular? What was appealing about
the business of GFL?
GRAHEK: I don't think they were looking
for a waste management deal in particular.
ey were looking for a great company —
as they always do. ey were very interested
in accessing the Canadian market, but the
deal was won on its merits, and wasn't nec-
essarily derived from geographic or sectoral
requirements. e transaction made sense
for both parties. Geographic diversity was
appealing as was the rate of growth, the
management team, the sector itself, the
runway and opportunity for growth. It
was also appealing for the opportunity of
greater synergies with scale.
Lexpert: How much did GFL know about
Growth Spurt
BC Partners before this deal?
GRAHEK: Having had several private capital
partners since our inception, GFL is famil-
iar with many of the potential investors in
our space and their reputations. But just as
BC Partners had to get familiar with GFL,
GFL had to get comfortable with the peo-
ple at BC Partners and their consortium
members to be satisfied that they would
be the supportive, committed and strategic
partners that GFL needed at this stage in
the implementation of our growth plans.
e process allowed us to do that.
Lexpert: Did the lawyers and clients know
each other previously? Were the external
counsel long-time advisors? Recent hires?
How would you describe the working rela-
tionship between the different legal teams?
JEFFREY SINGER, Stikeman Elliott LLP (for
GFL Environmental): We have been GFL's
counsel since inception, so there has been
a fairly long-standing relationship. At this
point, we almost finish each other's sen-
tences, and in many respects operate as one
integrated team. ere can be quite an in-
tensity to many GFL transactions, and this
one was certainly no different. Fortunately,
there was a great sense of collegiality; so
much so that the teams generally chose to
eat and laugh together rather than to re-
treat to our own corners, so to speak. It was
exhausting but a lot of fun.
GRAHEK: We have a long history work-
ing with Stikeman Elliott on many of our
acquisitions and on other financings and
recapitalizations. is familiarity has al-
lowed them to build a strong team that
"gets" GFL — what matters to us, as well
as the need to get deals done within tight
timelines. e dynamic between the deal
teams was very constructive. is deal
moved quickly. Everyone worked around
the clock to get it done well and while we
had our battles, in the end, the legal teams
With new private partners aboard, GFL Environmental continues its 'ambitious' plans
INTERVIEW BY GENA SMITH
Joy
Grahek
GC, GFL
Environmental
Jeffrey
Singer
Stikeman
Elliott LLP
(for GFL)
ON THE DEAL
There was an intensity behind GFL Environmental's deal with Private Equity buyers BC
Partners and Ontario Teachers' Pension Plan. That makes sense given the $5.1-billion
in enterprise value transaction is Canada's largest private management buyout to date.
Shahir
Guindi
Osler,
Hoskin
& Harcourt LLP
(for the
Investors)
