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Case Study

An Environmental Services Company Captures Massive Savings from a Merger

We supported every aspect of the complex integration.

$500 million

expected synergy savings over 5 years post-merger

$500 million

expected synergy savings over 5 years post-merger

The Story

The stakes were sky-high for a large environmental services company that had acquired its long-time rival. The takeover bid was a carve-out, based on a plan to divest 40% of the acquired company at the outset—and possibly more as post-merger integration proceeded. As leaders commenced the delicate and urgent process of merging their global business lines, they sought strategic advice from the merger specialists on our energy and natural resources consulting team.

We helped EnviroCo* integrate operations across more than 30 countries, setting the company on track to exceed its target of $500 million in synergy savings over the five years following the merger. Our support helped secure day-one post-merger readiness, carve out successful divestitures, and preserve the elements of company culture that had made both companies so strong.

A careful approach to a complex corporate marriage

EnviroCo serves municipalities and corporations around the world. Its merger deal was mostly a scope play, but it also enabled some powerful scale operations in certain regions where the merger made new combinations of markets and services possible.  

At the outset, we established an integration merger office (IMO) that involved hundreds of people from both companies, representing every business function and region. The IMO was responsible for securing the base business, mapping out new work processes, and unifying the company’s technological platforms and resources.

Meanwhile, a separate team, composed of our M&A consulting colleagues and a sounding board of top EnviroCo executives, designed plans for the combined entity’s new operating model. This team defined the “merger intent”—setting the priorities for EnviroCo’s extended portfolio of regions, business lines, and technologies. The team identified specific ways for each division of the company to capitalize on the synergies of the merger, such as cross-selling certain services in a given geography or enriching the offerings EnviroCo could make in complex proposals.

While synergistic savings and efficient new processes were important, so too was maintaining the well-established culture of EnviroCo, where many employees had enjoyed long careers and developed behaviors essential to the company’s success. We helped EnviroCo create welcome materials for every incoming employee, explaining how things worked. The acquirer’s verbal culture and global footprint made it challenging, but we succeeded in drafting communications that captured, in the simplest of terms, the unique values of EnviroCo and the intentions of the merger.

A multi-local approach and a successful divestiture

Although EnviroCo is a global company, it wouldn’t make sense to manage it through centralized, top-down directives; like most utilities, EnviroCo is made up of national-level business units shaped by local regulations and consumer needs.

That’s one reason why we took a multi-local approach, leaving a lot of autonomy to the company’s leaders in various countries. As the IMO set guidelines and priorities from the center, we made sure that local leaders had the necessary freedom to move independently within the framework the IMO established.

To do this, we examined the company’s operations in nearly 30 countries and identified four archetypes based on the kind and amount of business the company does in each. Sorting the national operations into these local archetypes helped us guide each office through the integration with appropriate guardrails and expectations.

Meanwhile, regulators in more than one nation had responded to the EnviroCo takeover with antitrust measures, effectively limiting the larger company from absorbing the entirety of the smaller one. We helped EnviroCo carve out the necessary divestitures—both the large one, as planned, and several smaller ones. Our support included discussions with antitrust authorities, ring-fencing assets related to the sale, and strengthening the value proposition offered to the carve-out’s prospective buyers.

A successful merger and a continued partnership

Our merger integration support put EnviroCo on track for day-one readiness across business units and regions. Careful planning helped secure nearly $500 million in synergy savings while facilitating the cultural integration of two distinct companies. The divestitures were sold off at the higher end of the expected price range. Our collaboration with EnviroCo continues, as the company has now asked us to assist with strategies for innovation and net-zero emissions.

We take our clients' confidentiality seriously. While we've changed their names, the results are real. 

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