{ "docId": "019dd923-622c-750b-8b98-f7d835dc2a36", "docSlug": "0a3a22290f60", "documentTitle": "GFL Environmental Inc. (GFL)", "authorId": "54_Spruce_Point_Capital", "authorName": "Spruce Point Capital Management", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2020-08-18 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 84, "pageCount": 106, "prevPage": 83, "nextPage": 85, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 12, "notes": "Uses a table from an Ares Capital 10-Q to highlight the distressed nature of the target company.", "elementsJson": [ "headline_text", "paragraph", "quote_block", "data_table", "callout_box", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b98-f7d835dc2a36/84", "deckHref": "/decks/019dd923-622c-750b-8b98-f7d835dc2a36", "deckJsonHref": "/decks/019dd923-622c-750b-8b98-f7d835dc2a36.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b98-f7d835dc2a36#slide-84", "components": [ { "bbox": { "h": 0.2, "w": 0.35, "x": 0.05, "y": 0.72 }, "kind": "callout", "text": "Ares Capital marked Soil Safe's equity at zero and booked a $13m \"net realized gain\". This suggests the deal was close to the value of the debt's fair value. The double digit interest rates paid by Soil Safe at a time of ultra low borrowing costs illustrate that Soil Safe was a deeply distressed company.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "9040a021-d893-4a85-b701-7e3df0a0cc1a", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "callout", "text": "Ares Capital marked Soil Safe's equity at zero and booked a $13m “net realized gain”. This suggests the deal was close to the value of the debt's fair value. The double digit interest rates paid by Soil Safe at a time of ultra low borrowing costs illustrate that Soil Safe was a deeply distressed company.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd952-e6ed-775b-bca7-c7ca00fa8706", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "metric", "text": "Fair Value: $140m", "attrs": null, "subkind": "primary", "toolName": "Quantification", "toolSlug": "quantification", "confidence": null, "componentId": "019dd952-e6ed-775b-bca7-ce69a01c12cc", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.9, "x": 0.05, "y": 0.17 }, "kind": "paragraph", "text": "GFL announced the acquisition of Soil Safe in July 2019. The deal announcement lacked financial terms... It appears that Soil Safe was struggling to make money and having to borrow at double digit interest rates.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "41595569-52ef-4aec-a776-caed05d7cb54", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.82, "x": 0.13, "y": 0.32 }, "kind": "quote", "text": "\"Soil Safe and its management team led by Mark Smith, are recognized as industry leaders... We are excited to welcome Soil Safe and its employees to the GFL team.\"", "attrs": null, "subkind": "pull-quote", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f8fc5312-461c-4a03-bc1e-0447333aa586", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "\"Soil Safe and its management team led by Mark Smith, are recognized as industry leaders in contaminated soil recycling and the development of inert soil products for beneficial use in sustainable construction and green building applications. GFL is one of the largest processors of contaminated soils in Canada and our acquisition of Soil Safe is in keeping with our strategy of replicating all of our service offerings in the US,\" said Patrick Dovigi, GFL's Founder and Chief Executive Officer. \"Soil Safe's in-house expertise and recycled products complement and extend our existing capabilities as we build our infrastructure business to service our customers' needs across North America. We are excited to welcome Soil Safe and its employees to the GFL team.\" — Patrick Dovigi, GFL's Founder and Chief Executive Officer", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd952-e6ed-775b-bca7-c849edf277c6", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.3, "x": 0.05, "y": 0.95 }, "kind": "source-note", "text": "Source: Ares 10-Q 6/30/19 and 10-Q 9/30/19 1) GFL Press Release", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "576df775-5ec0-4252-8f32-a49289467422", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.35, "w": 0.85, "x": 0.1, "y": 0.48 }, "kind": "table", "text": "Table showing Ares Capital's investment in Soil Safe, including interest rates, acquisition dates, and fair value.", "attrs": null, "subkind": "data", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "5065cc40-cef1-4a20-8e18-06df02bb9e03", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.65, "x": 0.31, "y": 0.03 }, "kind": "title", "text": "Did GFL Pay Almost $140m For Soil Safe, A Distressed Asset?", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "00ceb324-0ea3-4707-af76-ae5adad5ce4b", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "expose_contradiction", "slug": null, "matchId": "730e8be7-2215-4e16-be1c-be83c936d7a8", "evidence": "Contrasts GFL's optimistic press release with Ares Capital's distressed financial data.", "confidence": 1 } ], "arcBeats": [], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }