Return Holdings Sale of Assets
December 12, 2024 –

Sale of Waste Disposal Facilties

Wilcox Investment Bankers Serves as Exclusive M&A Advisor to Return Holdings, LLC on the Sale of Waste Disposal Facilities to Milestone Environmental Services

Since 2017, Return Holdings, LLC, along with its subsidiary Return Disposal, LLC ("Return" or "the Company"), has developed and operated three full-service commercial waste disposal facilities. These facilities provide customers in the Permian Basin with convenience and cost savings through environmentally preferred solutions. Each site is equipped to manage:

  1. Wet solids, including oil- and water-based mud, acids, tank bottoms, and other solid materials.
  2. Produced saltwater.

Return employs a proprietary, highly effective, and environmentally safe cuttings re-injection (CRI) slurry process, which injects disposal materials downhole into commercially permitted saltwater disposal wells. Additionally, the Company offers complementary washout and freshwater rinse services.

 

Waste Facilities Sold

The transaction included the sale of the following three facilities:

  1. Cross Ell Slurry Injection Facility
    • Address: 209 Stallings Rd, Big Spring, TX 79720
  2. Mentone Slurry Injection Facility
    • Address: 1674 US Hwy 285N, Mentone, TX 79754
  3. Midkiff Slurry Injection Facility
    • Address: 22407 S Hwy 349, Midkiff, TX 79755 (formerly known as Hwy 349 SWD)

 

Return Holdings Sale of Assets

‍The Challenge

After successfully developing and operating three waste disposal facilities, Return Holdings and its investors sought to test market interest from potential strategic buyers. The transaction process faced three significant challenges:

  1. One facility was relatively new and still in ramp-up mode, requiring buyers to assess its long-term value.
  2. A substantial fire at one of the facilities necessitated a large-scale rebuild.
  3. The Company was subject to a material damages lawsuit, adding complexity to the transaction.

The Solution

Wilcox Investment Bankers devised a tailored marketing strategy that highlighted the attractive features of the facilities and their near- and intermediate-term growth potential. By targeting a select group of strategic buyers, Wilcox created a competitive bidding environment. Ultimately, Wilcox successfully negotiated a compelling purchase price and transaction structure with Milestone Environmental Services. This process culminated in the execution of a letter of intent.

To address the associated risks, Wilcox worked closely with all parties to negotiate an indemnification agreement. This agreement balanced the concerns of the buyer while remaining acceptable to Return’s ownership group.

Strategic Value of the Transaction

The sale provided significant strategic value to both parties. Milestone Environmental Services gained complementary facilities that aligned seamlessly with its existing footprint, enhancing its market share in the Permian Basin. For Return investors, the transaction delivered an attractive return on investment and a substantial liquidity event, exceeding expectations.