Houlihan Lokey Advises US Ecology (1)

Houlihan Lokey is pleased to announce that US Ecology, Inc., has merged with NRC Group Holdings Corp. (NRCG). The all-stock transaction valued NRCG at an enterprise value of $966 million. The transaction was signed on June 24, 2019, and closed on November 1, 2019.

US Ecology, Inc. (Nasdaq:ECOL) is a leading North American provider of environmental services to commercial and government entities. The company addresses the complex waste management needs of its customers, offering treatment, disposal, and recycling of hazardous, nonhazardous, and radioactive waste, as well as a wide range of complementary field and industrial services. US Ecology's focus on safety, environmental compliance, and best-in-class customer service enables it to effectively meet the needs of its customers and build long-lasting relationships. The company has been protecting the environment since 1952 and has operations in the United States, Canada, and Mexico.

NRC Group Holdings Corp. (NYSE American:NRCG) is a global provider of a wide range of environmental, compliance, and waste management services. NRCG's broad range of capabilities and global reach enable it to meet the critical (and often nondiscretionary) needs of more than 5,000 customers across diverse end markets to ensure compliance with environmental, health, and safety laws and regulations around the world. NRC Group, a wholly owned subsidiary of NRCG, was established in June 2018 through the combination of two businesses, National Response Corp. and Sprint Energy Services, which previously operated separately under the ownership of investment affiliates of J.F. Lehman & Co.

The merger supports US Ecology's vision of becoming the premier provider of comprehensive environmental services by adding high-quality landfill disposal assets, a complementary new oil and gas exploration and production (E&P) waste stream, and an expanded scale of key service verticals that drive volume to the company's fixed facilities. The addition of more than 50 service sites will provide a platform to support other field services offered by US Ecology, including retail compliance, lab pack, and less-than-truckload (LTL) waste transportation. In addition, as a nationally recognized Oil Spill Removal Organization (OSRO), NRCG provides mandated emergency response for the transportation of oil products—a recurring, compliance-driven revenue stream with upside from spill events and international expansion.

NRCG common stockholders received 0.196 shares for each share they owned upon the closing of the transaction. The exchange ratio represents a price of $12 per share of NRCG stock, based on the US Ecology average share price over the last 15 trading days prior to announcement. Post closing, US Ecology stockholders own approximately 70% of the combined company, and NRCG stockholders own approximately 30% on a fully diluted basis.

Houlihan Lokey served as financial advisor to US Ecology and assisted the company in the structuring, valuation, and negotiation of the transaction. This transaction highlights Houlihan Lokey's long-term relationship with US Ecology, representing the third time Houlihan Lokey advised US Ecology in a successful transaction, including its acquisitions of Stablex and EQ.