Toronto’s new garbage magnate grew up in Sault Ste. Marie and showed an early aptitude for goaltending after his father and uncle started firing pucks at him.
Patrick Dovigi followed his cousins Phil and Tony Esposito into the NHL, but spent most of his short career as an Edmonton Oilers’ second-round draft pick in the minors. Now Mr. Dovigi runs Green For Life Environmental (GFL), the firm that won Toronto’s $186.4-million garbage contract. “He’s very competitive,” said his father, Fred, a retired teacher.
Since leaving pro hockey, Mr. Dovigi, 32, has been involved in ventures ranging from the gritty world of car-leasing to a stint on the board of an entertainment startup led by KISS founder Gene Simmons. Mainly, he has quickly forged impressive connections in the North American waste management industry. “It would appear that he’s moving faster in street shoes than he did in skates,” his father said in an interview.
Industry observers agree: GFL emerged from relative obscurity – it operates several GTA transfer stations while its largest subsidiary, National Waste Services, has contracts to collect municipal trash and recycling in Hamilton, Oshawa and until recently Kawartha Lakes – to win the high-profile Toronto deal. “They’re a new player,” said Octagon Capital research analyst Robert Gibson.
The firm significantly under-bid larger rivals like The Miller Group and Waste Management Canada to win the contract, a tactic that has attracted much attention. “You wonder how much money they can make off it,” said Mr. Gibson. “Obviously, the guy who won [the contract]has significantly lower operating costs or a lower profit margin.”
In an e-mail, Mr. Dovigi defended GFL’s bid: “We conducted all the necessary research with respect to the contract prior to submitting the bid. We currently service 180,000 homes for the City of Hamilton and have very informed and detailed costing analysis as to what it cost per home to pick up waste and recyclables.”
After graduating from Ryerson, Mr. Dovigi got his first exposure to waste management in 2002 when he joined Brovi Investments, a holding company owned by Romeo Di Battista Sr.
Mr. Di Battista, a prominent Italian-Canadian businessman, was an early investor in Telelatino and a member of the group of philanthropists who donated $13-million to the Art Gallery of Ontario’s Galleria Italia. He also owns a stake in Keele North Recycling, a Vaughan recycling and disposal firm run by his son, and other construction contractors.
“I got into the waste disposal business by accident,” Mr. Dovigi said in his e-mail. “I was working in corporate finance and one of our investments included a transfer station in Maple, Ont., which needed someone to manage the site, clean it up and reopen it.”
Brovi had a second mortgage on the transfer station, which had been ravaged by fire in 2004. It was also a secured creditor to Waste Excellence Corp.,which won the job to do the remediation work on the Maple site from the City of Vaughan. Mr. Dovigi served as Waste Excellence president.
In 2007, WEC and the City of Vaughan got into a dispute over bouncing cheques and unauthorized uses of the Maple transfer station, according to a February, 2011, staff report. Mr. Di Battista and other creditors pushed WEC into receivership in 2008 and transferred the operating license to another firm. But Mr. Dovigi stressed that these incidents occurred after he left WEC in 2007: “When I ran the business there was NO dispute with the City of Vaughan.”
While he was running WEC, Mr. Dovigi’s career digressed into the world of show business. In 2004, he took a seat on the board of NGTV (“No Good TV”), a YouTube music and celebrity channel fronted by Mr. Simmons. It’s not clear how he hooked up with Mr. Simmons, but three Toronto investment firms – Front Street Investment Management, Hazelton Capital Partners and AEGON Capital Management – had money in the venture. NGTV went bankrupt in 2008 before it could go public.
Mr. Dovigi formed GFL in 2007, merging several local haulers, including National Waste Services., which in 2005 had won a $40-million five-year contract to collect residential waste and recycling in parts of Hamilton. One of GFL’s early backers was Bay Street veteran Christopher Payne, managing director of Genuity Capital Partners and a long-time CIBC executive.
Genuity has underwriting links to another of Mr. Dovigi’s backers in the waste industry. Roark Capital Group, an Atlanta private equity firm, invested $105-million into GFL last fall. In 1995, the firm’s managing partner, Jeffrey Keenan, started a small Texas trash hauler, IESI Corp., and built it into the 10th largest waste firm in the U.S., with contracts in major metropolitan regions, including New York. According to The New York Times, IESI in 2000 threatened to withdraw service in parts of New York because the routes were not profitable.
Mr. Keenan, a former Lehman Brothers executive who now sits on GFL’s board, declined to be interviewed.
In 2005, waste management giant BFI Canada executed a blockbuster deal to buy the Texas hauler for $1.1-billion. The merged firm, which is publicly traded, now operates as Progressive Waste Solutions. Toronto council this spring voted to exclude Progressive from the outsourcing bids after the company recruited long-time Toronto waste management official Geoff Rathbone.