The giant merger of #1 Waste Management (WMX) and #3 USA Waste Sytems completed all required steps by July 27, 1998. The new giant Waste Management, Incorporated (WMI) combines the executive talent of USA Waste and their Houston headquarters with the troubled #1 WMX into an ideal merger, given that WMX was unable to gain a top flite executive team to run its company. Federal agreement of the merger came with the requirement to sell businesses in 21 markets representing at least $275 million in annual revenue.
Divested required by the Justice Department centered on disposal issues rather than collection assets. WMI will sells more assets in Ohio than any other state, including landfills near Akron and Columbus plus transfer stations and hauling operations serving Akron, Cleveland and Columbus. Negotiations for divestment also ended with state attorney generals in the Arizona, California, Colorado, Florida, Kentucky, Maryland, Michigan New York, Pennsylvania, Texas, Washington and Wisconsin. In addition to Ohio divestments, the new company will also divest in Baltimore, Detroi, Houston, Louisville, Miami, New York City, Philadelphia, Denver, Allentown (Pa), Pittsburgh, Portland, Tucson and Gainesville (Fl). Republic Industries (WMX founder Wayne Huizenga's new company) appears to be the major purchaser of the required divestment assets.).
Certainly one can legitimately ask how the #1 waste management company (WMX) would merge and accept the executive leadership and home office of the #3 company. This unusual merger came because WMX management was under attack by large investors. WMX did announce restructuring but despite founder Dean Buntrock's retirement, the plans were window dressing and all major changes were stopped by Buntrock who graduated to the Board of Directors Executive Committee. Finally, WMX hired a new CEO but he only lasted for three months, probably after he discovered the troubles of the corporation and the failure of Buntrock to really retire. Finally, WMX investors brought in the turn around expert to Chair the Board and forced Buntrock off the Board. Expert Miller revealed publicly hos WMX had cooked its books using every somewhat legal accounting practice to show high profits. The company restated its profits and soon found some massive stockholder lawsuits facing it plus an SEC investigation. The company faced multiple dilemmas on top of now acknowledged top heavy middle management needing major restructuring. After months searching for a new CEO, the company announced its merger with USA Waste. The decision appears to be the best one for the troubled giant.
USA Waste Systems has grown in the last five years like WMX grew in the early eighties. In the last few years it has grown from $900 million sales in 1993 to $2.6 billion sales in 1997. Much of this gain came from acquisitions. USA Waste took over in recent years United Waste Systems, Mid-American Waste Systems, TransAmerican, Western Waste Industries, and Sanifill. In addition they took over the Canadian operations of Allied Waste Industries and WMX,
The first significant public decision by the new WMI management has been the announcement of a buyout agreement with the major stockholder of Waste Management International to be completed by November 1998. This will result in international operations now being carried out by a wholly-owned subsidiary.
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