GFL Environmental Inc. has announced a significant recapitalization of Green Infrastructure Partners (GIP) in a deal valued at $4.25 billion. This agreement involves funds managed by Energy Capital Partners (ECP) and is set to close around September 2, 2025. GIP, established in 2022 by GFL, HPS Investment Partners, and Patrick Dovigi, will receive $775 million in gross proceeds from the transaction.
Of the total proceeds, GIP plans to distribute approximately $585 million to its shareholders, with GFL set to receive about $200 million. This distribution will enhance GFL's stake in GIP, bringing its ownership to approximately 30.1%, valued at around $895 million. HPS and Dovigi will also maintain minority stakes in GIP, supporting its future growth.
Patrick Dovigi, GFL's CEO, emphasized that this recapitalization reflects the strong management and growth of GIP since its inception. The funds received will be utilized for various corporate purposes, including reducing debt, pursuing growth strategies, and potentially executing share buybacks. Dovigi expressed confidence that GFL could create significant value for its shareholders through its investment in GIP, which has appreciated from $250 million to approximately $1.1 billion in just over three years.
The decision to partner with ECP was based on a thorough evaluation, as ECP is recognized for its expertise in critical infrastructure investments. Dovigi looks forward to collaborating with ECP to enhance GIP's growth strategy.
Scot French from HPS praised the milestone achieved by GFL and GIP, highlighting their role in improving essential infrastructure services. Drew Brown from ECP noted the promising opportunities for GIP's integrated infrastructure offerings and expressed eagerness to work with GFL and GIP leadership to drive growth and enhance margins.
GFL, headquartered in Vaughan, Ontario, is the fourth largest diversified environmental services company in North America, employing over 15,000 people across Canada and 18 U.S. states. HPS Investment Partners is a global investment firm focused on providing innovative capital solutions and generating attractive returns for clients.
