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Americas Private Credit Review – May 23, 2025

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Editor’s Note: Welcome to Octus’, formerly Reorg’s, Americas Private Credit Review. This regular report encapsulates market information, data and commentary relevant to private debt investors and professionals in the United States. We include a curation of Octus’ enterprise journalism, with links to unverified third-party press reports and primary sources. Finally, the review includes a link to a deal tracker for private credit and M&A transactions.

Dealmakers Not Letting Environmental Services Opportunities Go to Waste

By Armie Margaret Lee, Emily Fasold

Investors are seeing beauty in trash, fueling a constant stream of deal activity in the environmental services sector.

“M&A in the environmental services industry has been more robust than the deal volume more broadly, and the transactions that have occurred have been completed at healthy valuations,” said Robert Michalik, managing director at private equity firm Kinderhook Industries LLC.

Recent deals in the sector include Berkshire Partners’ investment in Triumvirate Environmental Inc., whose services include waste disposal for companies in the life sciences, healthcare and manufacturing end markets. The transaction, announced in February, valued Triumvirate at $1.8 billion. Oak Hill Advisors was the administrative agent and joint lead arranger for a unitranche facility that supported the transaction.

Also in February, J.F. Lehman & Co. acquired waste management company Atomic Transport LLC. A lender group led by Deutsche Bank Private Credit & Infrastructure provided financing for the transaction.

Interstate Waste Services Inc., which is backed by Littlejohn & Co. LLC and Ares Management Corp., bought waste hauling company Pinto Service Inc. and National Transfer Inc. in March.

Deal activity in the environmental services industry has remained fairly consistent for the past five years, said Jordan Mendel, a managing director in the business services group and a senior officer in the environmental services practice of investment bank Houlihan Lokey.

The solid waste, specialty waste and related services segments that make up the environmental services industry “have all been very active [in M&A],” Mendel said.

‘Golden Era of Garbage’

Post-Covid has ushered in what Kinderhook’s Michalik has dubbed the “golden era of garbage.”

Because of its essential nature, the waste industry has shown that it can “pass price at/or above cost increases,” he said, adding, “This has opened the eyes of the investment community and made the industry very attractive to them.”

The sector has drawn the gaze of infrastructure-oriented and private equity funds seeking businesses with predictable, stable cash flow that are “insulated from technology risk and resistant to economic cycles,” Michalik said.

Kinderhook has completed more than 100 environmental services transactions since its founding in 2003, including its investment in solid waste collection company Apex Waste Solutions and Apex’s purchase of Materials Management Co. and All American Disposal last year. Comerica Bank provided financing for the transaction, according to the May 2024 announcement.

Elazar Guttman, a partner at Sidley Austin LLP, said M&A in the space shows no near-term signs of slowing down.

“I’m optimistic – from my vantage point, people are eager to deploy capital in the space,” he said, adding that his clients have anecdotally appeared to have better deal flow recently than “a lot of the rest of the market.”

Guttman noted that lender interest has also been strong in the sector.

“We’ve seen that both direct lenders and banks have been very eager to provide debt financing for environmental services companies, which can’t be said for all sectors at the moment.”

Insulated From Tariff Talk

Amid the macroeconomic uncertainty, “we believe that the environmental services industry is insulated from the broader tariff conversation, given the domestic nature of the space,” said Betsy Booth, a partner at direct lender TPG Twin Brook Capital Partners.

Within environmental services, the recycling and waste hauling segment continues to be active in M&A, Booth said, adding that it’s a fragmented space that creates opportunities for a rollup strategy.

“The underlying credit metrics make this space attractive,” Booth said.

Part of the allure of the sector is the recurring revenue nature of the businesses, along with a highly diverse customer base and high retention rates, Booth said.

Customers, especially on the residential side, are not really thinking about this service “as long as their garbage is being picked up every week,” she said.

Aside from its insulation from tariffs, the essential nature of environmental services has also been a draw for both debt and equity investors, who have generally been taking a more cautious approach with companies that are considered discretionary, Guttman said.

“Environmental and waste solutions aren’t optional services, so they provide good isolation from all of the [macroeconomic] pressures,” he said. “As a result of that, people perceive safety in this industry and feel like they can continue to transact.”

Octus’ U.S. private credit deal tracker aggregates 954 deals announced in 2024 and 2025. Learn more about Octus Private Credit and Deal Origination Insights HERE.

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