UPDATE: Aug. 1, 2024: Casella Waste Systems confirmed its acquisitions of Whitetail Disposal, effective Aug. 1, and LMR Disposal, effective July 1. The transactions are expected to generate over $100 million of total annualized revenues. 

The deals “represent continued execution against our disciplined growth strategy, further expanding our operations in the Mid-Atlantic where we are densifying and expanding operations,” said CEO John Casella in a statement.

Dive Brief:

• July 29: Pennsylvania-based Whitetail Disposal is set to be acquired Aug. 1, with multiple sources naming Casella Waste Systems as the buyer. These sources include people with knowledge of the regional industry as well as Facebook posts from people identifying as employees of local hauling companies.
• Whitetail, established in 2008, has an estimated 350 employees. It offers residential, commercial and roll-off services, as well as recycling services. It also holds an estimated 18 municipal contracts in eastern Pennsylvania.
• Casella also recently acquired New Jersey-based LMR Disposal, a smaller hauler that services the central part of the state as well as certain areas in eastern Pennsylvania. That transaction closed in early July, Waste Dive confirmed.

Dive Insight:

The respective completed and pending acquisitions will help cement Casella’s hauling presence in eastern Pennsylvania, a region it entered in 2023 when it acquired certain assets from GFL Environmental — its largest deal in years. That GFL deal has opened the door for Casella to identify other possible deals in the mid-Atlantic region. 

Vermont-based Casella operates in multiple Northeast states with dwindling disposal capacity and has been increasingly focused on scaling up operations at its rail-served McKean Landfill in Pennsylvania. During the company’s April earnings call, CEO John Casella said the state had “significant” disposal capacity available to support future growth.

President Ned Coletta, speaking at a June event hosted by Stifel, also said the company aims to expand its recycling business in the region. Casella acquired a recycling facility as part of the GFL transaction, but Coletta said the equipment is outdated. “So we have a plan in 2025 to upgrade that facility,” he said, describing the region as “a market that’s ripe for driving a lot more recycling and circularity.”

News of a possible Whitetail sale has been circulating for many days. Local station WFMZ reported on July 23 that the company was selling to an unspecified buyer, which was in turn reflected by Pitchbook’s database. According to sources, Whitetail employees were informed of a pending sale to Casella last week ahead of the Aug. 1 closing date.

Neither company responded to requests for comment.

Whitetail Disposal has upward of 250 vehicles, according to federal records. The company serves numerous regions of eastern Pennsylvania, including near Allentown and in Schwenksville, and has won a string of local contracts in recent years. According to a December 2023 release, Whitetail was servicing almost 210,000 residential, commercial and industrial customers at the time. The company described itself then as “the fastest growing hauler in the Philadelphia service area.”

Whitetail has primarily focused on organic growth over acquisitions, according to a 2021 profile in Waste Today, and has made a name for itself as a locally operated company with an emphasis on customer service. CEO Mike Schmidt founded the company after previously working in the waste industry.

The prevalence of subscription service in certain areas is a complementary fit with Casella’s model that it employs in more rural areas of the Northeast, which also gives it more flexibility with pricing.

The LMR assets are similarly complementary to Casella’s growing mid-Atlantic footprint, which also includes parts of Delaware and Maryland. Local officials in Flemington, New Jersey, approved the transfer of a collection contract from LMR to a Casella subsidiary in late June, as first reported by TapInto, and mentioned LMR’s sale of the company at the time. LMR, which has an estimated 48 vehicles according to federal records, has not publicized the transaction so far.

This region has seen multiple other deals in recent years, including Waste Connections’ purchase of A.J. Blosenski in Pennsylvania and Blue Diamond Disposal in New Jersey.

Casella didn’t report any notable M&A spending in Q1, but previewed a potential pipeline of deals worth $800 million in annualized revenue that included options in the mid-Atlantic. The company is set to hold a Q2 earnings conference call on Aug. 2.