Company Update (NES) (CLH): Clean Harbors Inc and Nuverra Close Acquisition of Thermo Fluids Inc.

Clean Harbors Inc (NYSE:CLH), the leading provider of environmental, energy and industrial services in North America, and Nuverra Environmental Solutions Inc (NYSE:NES), a leading provider of full-cycle environmental solutions to the energy end market, announced the close of Clean Harbors’ planned acquisition of Thermo Fluids Inc. (TFI) from Nuverra.  Clean Harbors purchased Thermo Fluids for $85 million in an all-cash transaction.

Based in Scottsdale, AZ, TFI provides environmental services in 21 U.S. states through a network of 36 permitted facilities.  The company operates a well-maintained fleet of trucks and rail cars in servicing more than 20,000 customers.  TFI’s range of environmental services includes used oil recycling, used oil filter recycling, antifreeze products, parts washers and solvent recycling.  Its industrial waste management services include vacuum services, remediation, lab pack and hazardous waste management.

Clean Harbors Chairman and Chief Executive Officer Alan S. McKim, said, “The acquisition of TFI aligns with our strategy to expand our environmental services customer base and drive incremental volumes into our hazardous waste disposal facilities.  TFI ideally complements our SK Environmental Services network as it strengthens our presence in the western U.S. by providing us density in certain regions while also opening new local markets to Clean Harbors.

“Further, TFI will add approximately 50 million gallons of waste oil to Safety-Kleen’s recycling and re-refining business.  We expect to effectively leverage its highly scalable platform of collection facilities, storage capabilities, rail assets and transportation fleet with our existing re-refining infrastructure.  The net result will be much more efficient collection and movement of waste oil throughout Safety-Kleen’s entire network,” McKim concluded.

Mark D. Johnsrud, Nuverra’s Chairman and Chief Executive Officer, said, “We believe Clean Harbors and its Safety-Kleendivision are an excellent strategic fit for TFI and its employees.  We commend the TFI team for their commitment to ensuring customers continue to receive the highest-quality services during this transition. This transaction enables us to now fully focus on our core shale solutions business strategies.”

Nuverra will apply 100% of the net proceeds received to reduce the outstanding balance under its asset-based revolving credit facility.  Pursuant to the agreement, $4.25 million of the proceeds was deposited into an indemnity escrow account to secure certain obligations of Nuverra under the purchase agreement.  After giving effect to the indemnity escrow, the closing date working capital adjustment and the payment of transaction fees and expenses, the amount of net cash proceeds received by Nuverra on the closing date was approximately $74.6 million.

Houlihan Lokey acted as exclusive financial advisor to Nuverra in connection with the transaction, and Squire Patton Boggs served as Nuverra’s legal counsel. (Original Source)

Shares of Nuverra Environmental closed today at $4.01, up 0.01 or0.25%. NES has a 1-year high of $21.29 and a 1-year low of $1.65. The stock’s 50-day moving average is $3.51 and its 200-day moving average is $6.21.

On the ratings front, Nuverra has been the subject of a number of recent research reports. In a report issued on March 17, Needham analyst Sean Hannan maintained a Buy rating on NES, with a price target of $4.50, which represents a potential upside of 12.2% from where the stock is currently trading. Separately, on the same day, Roth Capital’s Gerry Sweeney reiterated a Hold rating on the stock and has a price target of $3.50.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Sean Hannan and Gerry Sweeney have a total average return of 8.3% and -15.5% respectively. Hannan has a success rate of 60.3% and is ranked #836 out of 3574 analysts, while Sweeney has a success rate of 0% and is ranked #3317.

Nuverra Environmental Solutions Inc formerly, Heckmann Corp provides environmental solutions to customers focused on the development and ongoing production of oil and natural gas from shale formations.

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