Diligence · Waste & Recycling

Independent Sponsor Quality of Earnings in Waste & Recycling

Securities and M&A counsel for independent sponsors coordinating waste and recycling transactions, from LOI to close to the capital markets that open up afterward.

EV range $12M to $150M EV EBITDA $3M to $25M Audience Buy-side / Sponsor
The deal context

An independent sponsor closing waste and recycling transactions in the $12M to $150M EV range has a defined set of moves at the Quality of Earnings stage. Most of them are not in a generic M&A textbook.

The typical waste and recycling platform sits at $12M to $150M EV with EBITDA in the $3M to $25M range. The thesis runs on regional hauler or transfer station consolidation. Permitted volume is the asset, not the trucks. Diligence the permits before the EBITDA.

The moves

How Quality of Earnings actually gets structured.

  1. Engage QofE within five business days of LOI signing.

  2. Scope to include working capital normalization, deferred revenue, and customer concentration.

  3. Share preliminary findings with the seller before final report, to surface disputes early.

  4. Coordinate QofE findings into both the purchase agreement and the LP commitment package.

  5. In waste and recycling, layer in permit transfer applications filed before LOI signing as part of the Quality of Earnings workstream.

The common mistake

Treating QofE as a back-office exercise. It is the basis for the price, the working capital peg, and the LP pitch.

Jason's take
"The QofE is the deal book. Read it twice before you negotiate anything."
Jason Powell · Quality of Earnings
Capital after close

The deal is one thing. The capital that opens up after close is another.

Refinancing, recaps, growth rounds, and the right strategic conversation eighteen months early are all downstream of relationships that take years to build and minutes to use.

MONTH 18
Senior refi
MONTH 24
Dividend recap
MONTH 36
Growth equity
YEAR 4–5
Strategic exit
TALK TO JASON

An LOI on the desk, a waste and recycling target, and a Quality of Earnings question worth a real conversation.

Twenty minutes of practitioner-grade input from a securities attorney whose first move is to read the deal, not the engagement letter.