General Environmental Management Announces Completion of Acquisition of Santa Clara Waste Water
17 November 2009 - 1:15AM
Business Wire
General Environmental Management, Inc. (GEM) (OTCBB:GEVI)
announced today that it has completed the acquisition of Santa
Clara Waste Water (SCWW), a profitable, 50 year old, full service
environmental services company focused primarily on the waste water
treatment business. Since its inception, SCWW has treated more than
2 billion gallons of waste water and is in the top 100 privately
owned non-hazardous waste water utilities in the United States.
GEM financed the acquisition through the issuance of six
promissory notes in the aggregate principal amount of $9,003,000,
along with warrants for the principals of SCWW to purchase 425,000
shares of GEM's common stock. The notes bear interest at 6.5
percent per annum. Two of the Notes, totaling $3,778,000, are
convertible into a total of 15% of GEM's common stock on a fully
diluted basis. Further details of the notes can be found in the 8-K
issued by the Company.
“We are thrilled to have completed the acquisition of SCWW,”
said Tim Koziol, GEM Chief Executive Officer. “We plan to work with
SCWW CEO Doug Edwards and his team to achieve the goal of becoming
the premier independent non-hazardous wastewater management
company; First in California, then the western region and
eventually in the United States.”
Koziol continued, “As I have said repeatedly, we are acquiring
not only a successful company with a great track record and
valuable assets, we are partnering with one of the finest
management teams in the environmental management industry. Doug and
his team have set the standard for wastewater management. Their
facility situated on five acres of strategically located land in
Santa Clarita Valley, along with their unique and invaluable 12.7
mile pipeline from their facility to Oxnard’s water reclamation
center, gives GEM a corner stone to build a regional and then
national presence in the water treatment market.”
“This is an important day in SCWW’s journey to become a national
waste water treatment company,” said Doug Edwards. “I am very
excited to be uniting with GEM’s management team to build upon the
success we have earned at SCWW. I have long had a vision of growth
for SCWW and I am confident that by teaming with GEM, we will be
able to help make that vision a reality. The waste water treatment
market is large and will continue to grow as demand for water
treatment increases exponentially. SCWW is uniquely positioned to
take its assets, experience, knowledge set and strategic plan and
become one of the foremost waste water treatment companies in the
U.S. In addition, we have a number of unique products and services
in development that we can bring to market faster and with greater
efficiency with the help of GEM’s talented management group.”
GEM Chief Financial Officer, Brett Clark, added, “SCWW has a
profitable, high margin business model. We are acquiring the
company and all of its assets for approximately three times its
trailing EBIDTA, plus the assumption of long term debt secured by
SCWW’s plant and equipment. SCWW’s revenues in 2008 were
approximately $7.6 million. The transaction is very accretive to
GEM, and the terms of the transaction are very favorable to the
shareholders. Again, the details of the transaction can be found in
the 8-K.”
Because of the timing of the closing of this transaction, GEM’s
management has filed for an extension in filing its 10Q for the
quarter ended September 30, 2009 and will reschedule its earnings
conference call to Monday, November 30, 2009 at 1:30 pm PST.
Tim Koziol also provided an update on GEM’s efforts to sell its
field services business in order to focus on new business
opportunities. “We have made great progress over the past month in
our efforts to sell our field services business,” he said. “We are
actively engaged with the prospective buyer and will close this
transaction as soon as practically possible. Our goal is to
eliminate the majority of our debt and to refocus all of our
operating efforts on the more profitable and faster growing waste
water and waste-to-energy markets.”
About General Environmental Management, Inc.
General Environmental Management, Inc.
(www.GeneralEnvironmental.com) is a full service hazardous waste
management and environmental services firm providing integrated
environmental solutions managed through its proprietary web-based
enterprise software, GEMWare, including the following service
offering: management and transportation of waste; design and
management of on-site waste treatment systems; management of large
remediation projects; response to environmental incidents and
spills; and environmental, health and safety compliance.
Headquartered in Pomona, California, GEM operates five field
service locations and one Treatment, Storage, Disposal facility
(TSDF), servicing all markets in the Western U.S.
FORWARD-LOOKING STATEMENTS
This press release may include "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical facts,
included in this press release that address activities, events or
development that the company expects, believes or anticipates will
or may occur in the future are forward-looking statements. These
statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of the Company,
which may cause the Company's actual results to differ materially
from those implied or expressed by the forward-looking statements.
The Company assumes no duty whatsoever to update these
forward-looking statements or to conform them to future events or
developments.
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