US court blocks WCS sale

23 June 2017

A US court has blocked EnergySolutions Inc's $367 million acquisition of Waste Control Specialists LLC (WCS), ruling in favour of an antitrust filing against the merger by the US Department of Justice.

Operations at the Texas Compact Disposal Facility (Image: WCS)

EnergySolutions in November 2015 signed a definitive agreement to acquire WCS, operator of a low-level radioactive and hazardous waste processing, treatment, storage and disposal facility in Andrews County, Texas, for $270 million in cash and $20 million in stock. EnergySolutions also agreed to assume some $77 million of debt as well as all financial assurance obligations related to the WCS business in a deal WCS president Rod Baltzer described at the time as a "win-win" for both companies.

The Department of Justice filed suit in November 2016, alleging that the proposed acquisition would combine the two most significant competitors for the disposal of low-level radioactive waste available to commercial customers. After a ten-day trial, Senior Judge Sue L Robinson of the US District Court for the District of Delaware on 21 June ruled in favour of the lawsuit.

Acting Assistant Attorney General Andrew Finch of the Department of Justice's antitrust division said the decision protected competition in an industry that was "incredibly difficult" to enter. He said evidence had shown head-to-head competition between the two companies led to better disposal services at lower prices. "While EnergySolutions' preference was to buy its main rival rather than continue to compete to win business, today's decision ensures that customers will benefit from the competitive process," he said.

WCS operates two separately licensed disposal facilities for low-level radioactive waste at Andrews, Texas, including the Texas Compact Disposal Facility, the only commercial radioactive waste disposal facility in the USA to be licensed within the last 30 years. In April 2016 the company applied to the US Nuclear Regulatory Commission for a licence to construct and operate a Consolidated Interim Storage Facility (CISF) at the site.

Baltzer said the acquisition would have protected the continued operation of the company's low-level radioactive waste disposal facility. "The DOJ [Department of Justice] investigation and litigation has taken over 18 months at great expense to WCS, and WCS must now determine whether to appeal the trial court’s decision and further prolong the process and associated expense," he said.

EnergySolutions president and CEO David Lockwood said the company was disappointed with the ruling. "We believe this acquisition was in the best interest of the long-term waste disposal needs for the nuclear industry," he said.

Researched and written
by World Nuclear News