American Capital purchases Soil Safe

September 20, 2005|By June Arney | June Arney,Sun reporter

Bethesda-based American Capital Strategies Ltd. announced yesterday that it has purchased Soil Safe Holdings Inc., a Columbia-based soil-treatment company, from parent company The Halifax Group for $147 million.

Soil Safe, a mid-sized soil-treatment company, handles nonhazardous, polluted soil and has about 85 employees.

"We are excited to partner with a business that has a way of dealing with lightly contaminated soils," said David E. Steinglass, American Capital's managing director. "In most American cities, the only land available for development is brownfield property."

The acquisition is American Capital's second of a remedial firm. The first was a company called Weston Solutions in West Chester, Pa., Steinglass said.

American Capital, a publicly traded buyout and mezzanine fund with capital resources of approximately $5.4 billion, has invested more than $2.9 billion in the past 12 months, with $819 million in the quarter to date, according to company officials.

Mark J. Smith, new president and chief executive officer of Soil Safe, said the American Capital deal was done in conjunction with Soil Safe's acquisition of the California-based assets of TBS Technologies Inc., a thermal desorption treatment facility in the Mojave Desert that serves the Southern California market. Thermal desorption uses heat to remove contaminants and undesirable materials from soil by converting them to gas and collecting the harmful substances. That deal added about 17 employees to Soil Safe's existing East Coast operation, he said.

"We have a new partner that shares our vision of growth and is in a stronger position to foster that growth, particularly by expanding into new markets and soil treatment services," Smith said.

The company hopes to add a facility in the Los Angeles basin in addition to its TBS Technologies site in the Mojave Desert, Smith said. Soil Safe is also looking to expand into Texas and Florida, he said.

"Environmental services is an important industry," said Ivan Feinseth, managing director and director of research at Matrix USA LLC, an institutional research and brokerage firm in New York, who follows American Capital. "They have demonstrated a good ability to make good investments in industries that pay off for them."

Shares of American Capital Strategies closed yesterday at $37.18 on the Nasdaq, up 2 cents.

Founded in 1989, Soil Safe provides soil treatment and disposal services for construction projects that involves the excavation of lightly contaminated soil.

The company said it serves a base of more than 300 customers, including general contractors primarily involved in office construction, excavators, environmental consultants and oil companies in the Mid-Atlantic region. In addition to its headquarters, Soil Safe has operating facilities in New Jersey, Maryland and now, with the TBS acquisition, California. In 2004, Soil Safe completed approximately 1,300 projects.

june.arney@baltsun.com

Sun researcher Shelia Jackson contributed to this article.

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