US Ecology stock rockets after Republic Services buyout deal for a 70% premium

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Shares of US Ecology Inc. ECOL, +68.74% soared 67.3% in premarket trading Wednesday, after the provider of environmental services announced an agreement to be acquired by Republic Services Inc. RSG, +0.17% in a deal valued at $2.2 billion, including $700 million in debt. Under terms of the deal, US Ecology shareholders will receive $48 in cash for each US Ecology share they own, which represents a 70.4% premium to Tuesday’s closing price of $28.17. That price implies a market capitalization for US Ecology of $1.51 billion. The stock was up 27.5% prior to a trading halt for news, which was lifted at 9:05 a.m. Eastern. Republic shares slipped 0.4% ahead of the open. Republic expects the deal, which is anticipated to close by the end of the second quarter, to result in $40 million in cost synergies within three years after the closing, and to result in “double-digit” returns. US Ecology’s stock has tumbled 19.5% over the past three months through Tuesday and Republic shares have lost 4.7%, while the S&P 500 SPX, +1.03% has slipped 3.5%.

This article was originally published by Marketwatch.com. Read the original article here.

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