Casella, Louisiana-Pacific sell insulation company

Casella, Louisiana-Pacific sell insulation company

By Bobby Elliott, Resource Recycling

Dec. 12, 2013

Casella Waste Systems and Louisiana-Pacific (LP) have agreed to sell their membership interests in US GreenFiber, a manufacturer of building insulation made from recycled paper. The brand's new owner is investment firm Tenex Capital Management.

The deal, according to a press release, totals $18 million. Once expenses and services are accounted for, aggregate net cash proceeds are expected to reach $7 million.

Tenex's managing director and principal Joe Cottone told Resource Recycling the deal will give the firm ownership of US GreenFiber's nine cellulose insulation plants. Cottone added that, "under the right circumstances, we would be open to acquiring other cellulose companies as well."

While Casella and LP noted the positive partnership the two companies built during their joint ownership of US GreenFiber, Casella chairman and chief executive John W. Casella explained the sale of its non-integrated MRFs back in 2011 eventually meant US GreenFiber was no longer a profitable asset.

"We have enjoyed a successful 12-year partnership with LP and the GreenFiber management team," Casella said in the press release. "Initially, the GreenFiber cellulose insulation manufacturing business provided a natural hedge for recycled paper processed at our MRFs. However this intrinsic benefit dissipated after the sale of our non-integrated MRFs."

Tenex representatives noted the strong reputation and product line of US GreenFiber. "We have acquired a market leading company in the insulation industry that enjoys a strong reputation for superior quality and a high level of customer service with contractors, builders, retailers and homeowners," Tenex CEO Michael Green said in a press release.

The Green Fiber website lists 10 different insulation lines and all are listed as 85 percent recycled fiber.

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