General Environmental Management Inc. is now pursuing opportunities to build its position in the wastewater treatment and waste-to-energy industries, leveraging the funds it received from the sale of its Western Region Field Service business and its Rancho Cordova Transfer, Storage, and Disposal Facility, to Luntz Acquisition LLC. That sale was approved at a special meeting of stockholders on February 19, and was completed on February 26. It significantly improved GEM’s financial options, and will allow the company to move forward into what it sees as a more profitable market.
The immediate effect of the sale was to reduce GEM’s outstanding obligations to their senior lender by $9.1 million, with the remaining obligation of approximately $1.2 million to be paid down with the realization of various assets and deposits expected over the rest of this year. The senior debt outstanding of $5.6 million related to the mobile treatment business is offset by a note receivable from the buyers of that business. The note will be paid when the mobile treatment buyers refinance their debt, expected later this year. At that point, GEM’s senior lender liability will have been reduced by over $15.9 million.
GEM CEO, Tim Koziol, commented, “This sale was an important part of our transition strategy into the wastewater treatment services and waste-to-energy markets and will allow GEM to build on its recent acquisition of Santa Clara Waste Water Company, a wastewater treatment business. We believe there is a large and growing opportunity in wastewater treatment, both nationally and globally. We plan to use our core competencies to develop the business through professional sales and marketing while standardizing operations for regional, national and global growth.”
GEM President and COO, Bill Mitzel, added, “Our focus in wastewater treatment services and waste to energy will be in areas that are typically overlooked with new and innovative ideas. The two technologies have mostly been treated separately, but we are looking at ways to combine both for a greener approach.”
Let us hear your thoughts: General Environmental Management, Inc. Message Board