GFL Relocates HQ to U.S. for Stock Index Inclusion

Casey Halston

ago 2 hours

GFL Relocates HQ to U.S. for Stock Index Inclusion

GFL Environmental Inc., a major player in the waste disposal industry, is relocating its headquarters from Toronto to Miami Beach. This strategic move aims to attract a larger following from U.S. index funds while maintaining its status in Canadian markets.

Details of the Headquarters Relocation

Headquartered in Vaughan, Ontario, GFL announced the transition to Florida but will remain incorporated in Canada. About a dozen employees will relocate to Miami, and the operational impact is expected to be minimal. This move opens the door for GFL to qualify for influential U.S. stock benchmarks.

Benefits of the Move

GFL’s relocation enhances its eligibility for both U.S. equity indices, including the Russell index family, and preserves its membership in Canadian indices like the S&P/TSX Composite Index. CEO Patrick Dovigi emphasized that this relocation will facilitate better recruitment and business opportunities in the U.S., especially as two-thirds of the company’s revenue currently originates from the states, particularly in the fast-growing southeastern market.

Anticipated Investor Impact

Sources indicate that passive investors linked to U.S. benchmarks, such as mutual funds and exchange-traded funds (ETFs), are likely to acquire between 10% and 15% of GFL’s public float. This could translate to approximately 35 to 50 million shares of the company.

Context within the Industry

GFL is the fourth-largest waste disposal company in North America, employing around 15,000 individuals across Canada and 18 U.S. states. The company boasts a market capitalization of $21 billion and has expanded through various acquisitions.

GFL is larger than some firms in the S&P/TSX 60 Index.
Its recent move follows trends of other Canadian companies relocating to the U.S. for improved visibility and investor interest.

Comparison with Competitors

Rival companies such as Waste Connections and Brookfield Asset Management have similarly shifted headquarters to attract more investors. While GFL strives for growth, the S&P Dow Jones Indices has recently adjusted its rules to allow companies to retain Canadian status after relocating.

Future Outlook

GFL’s founders, private equity fund BC Partners and the Ontario Teachers’ Pension Plan, support expanding the shareholder base in the U.S. The company anticipates that a broader American investor following will provide greater liquidity for significant stakeholders.

Founded in 2007 by Dovigi, GFL has evolved beyond traditional waste collection to encompass recycling, soil remediation, and other environmental services. Despite facing challenges, including a violent campaign against its CEO last September, GFL’s focus remains on growth and infrastructure improvement.