Casella Waste Systems Inc. and Louisiana-Pacific Corp. (LP) have sold their membership interests in recycled products maker US Green Fiber LLC to private equity firm Tenex Capital Management for $18 million.
Rutland, Vt.-based Casella Waste and LP, of Nashville, Tenn., said in a news release they expect aggregate net cash proceeds to be about $7 million, after the working capital true-up and the repayment of indebtedness and other transaction expenses.
The company was bought by a limited liability company formed by Tenex, which is based in New York City.
US Green Fiber, Charlotte, N.C., makes natural fiber insulation, fire and sound products, manufactured with a minimum of 85-percent recycled paper fibers.
"Initially, the GreenFiber cellulose insulation manufacturing business provided a natural hedge for recycled paper processed at our MRFs (material recovery facilities); however, this intrinsic benefit dissipated after the sale of our non-integrated MRFs in March 2011," John Casella, chairman and CEO of Casella Waste. "Over the last five years, the GreenFiber management team did an excellent job navigating the deep downturn in the housing market. And, with their recent improved performance we took the opportunity to exit this non-core investment.”
Michael Green, Tenex CEO, said, "In GreenFiber, we have acquired a market leading company in the insulation industry that enjoys a strong reputation for superior quality and a high level of customer service with contractors, builders, retailers and homeowners.”
LP makes engineered wood building materials.