Stericycle to buy Shred-It International for $2.3 billion

Lake Forest-based medical-waste management company Stericycle Inc. agreed to buy document-destruction provider Shred-It International Inc. for $2.3 billion in cash to expand services to businesses seeking to comply with regulations.

The acquisition means Toronto-based Shred-It will scrap its plan to raise about C$600 million ($465 million) in an initial public offering that was to be Canada's largest this year. The company, owned by investors including Toronto-based buyout firm Birch Hill Equity Partners, had received takeover interest earlier this year from document-management company Recall Holdings Ltd.

The deal will boost cash earnings per share by at least 10 percent in 2016, Stericycle said Wednesday in a statement. The companies will be able to reap as much as $30 million in savings by combining, it said.

Stericycle will continue to be based in Lake Forest and doesn't plan to use the acquisition to move its headquarters for tax purposes, a maneuver known as an inversion, according to a spokeswoman.

The company helps hospitals, doctor's offices and drugmakers dispose of medical and hazardous waste, with more than 600,000 customers worldwide, according to its annual report. Stericycle has been expanding that business through international acquisitions, with 15 in the first quarter alone to add $42.5 million in annual sales.

Shred-it was established in 1988 as one of the first paper shredding companies in the world, according to its website. The company offers services to about 400,000 customers in 18 countries and has a fleet of about 2,400 trucks, according to a filing this month.

Shred-it has also grown through acquisitions, including last year's purchase of Iron Mountain's international secure shredding business in the U.K., Ireland and Australia and its combination with Cincinnati-based Cintas Corp.'s document shredding business.