Recall Said to Weigh Acquisition of Canadian Rival Shred-it

Recall Holdings Ltd., the document management company that rejected an offer from Iron Mountain Inc. last year, is weighing a bid for Canadian rival Shred-it International Inc., people with knowledge of the matter said.

Shred-it, which is owned by buyout firm Birch Hill Equity Partners, could be valued at about $1.8 billion, the people said, asking not to be identified discussing private information. A large acquisition could keep Recall from becoming a target for Iron Mountain again, in part by increasing the odds that antitrust regulators would block such a deal, one person said.

Recall, led by Chief Executive Officer Douglas Pertz, has made nine acquisitions since its 2013 spinoff from pallet provider Brambles Ltd. It increased a syndicated loan facility to $1.05 billion in November to fund further purchases it said are a “key component” of its growth strategy.

Deals from the past year include the $77 million purchase of Business Records Management LLC announced in December, as well as acquisitions in Australia and the U.K. In 2011, while it was still owned by Brambles, Recall acquired Shred-it’s U.S. document storage business.

Rebuffed Approach

Shares of Recall rose 0.1 percent to A$7.83 at 10:57 a.m. in Sydney, giving the company a market value of A$2.5 billion. Iron Mountain dropped 1.3 percent to $36.41 at the close of New York trading. Representatives for Recall and Birch Hill declined to comment.

Recall in December rebuffed a A$2.2 billion ($1.7 billion) cash and share offer from Boston-based Iron Mountain, the largest document-storage company. Since then, Recall said it would explore converting to a real estate investment trust structure in the U.S. to help maximize shareholder value.

Birch Hill, based in Toronto, invested in Shred-it in 2009. Shred-it last year acquired the shredding assets of Iron Mountain in the U.K., Ireland and Australia for $29.8 million, according to a November statement.

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