* Expands position in St. Louis, Mo. market
* Deal includes major solid waste landfill
* Agreement to sell methane gas from landfill (In U.S. dollars unless noted)
OTTAWA, Dec 23 (Reuters) - Canadian waste management company IESI-BFC Ltd BIN.TOBIN.N said on Thursday it will bolster its operations in St. Louis, Missouri, with a $159 million cash deal to buy waste collection, transfer and landfill assets.
Toronto-based IESI-BFC, North America's third-biggest solid waste management company, said the transaction with privately-held Fred Weber Inc makes it a "major operator" in the St. Louis market.
The company said it has acquired Missouri's largest municipal solid waste landfill, by volume, which is expected to last about 80 years.
It also purchased a municipal solid waste transfer station and collection business, which will be integrated with existing operations.
"The key theme for them is internalization: collecting volume and then driving it through to the landfill. This is a municipal landfill they acquired so that should help them and them on the solid waste side," Wedbush Securities analyst Al Kaschalk said.
The deal also includes a third-party agreement to sell methane gas produced from the landfill.
"That could actually reduce some of their costs if they're able to sell off part of the stream of the gas that's being collected," Kaschalk said.
IESI-BFC said it will increase its credit facility by $127.5 million in connection with the deal.
This summer, the company completed its acquisition of rival Canadian trash hauler Waste Services Inc, in an all-stock deal Kaschalk said was worth about $770 million.
Analysts expect IESI-BFC to continue growing through mergers and acquisitions and expand its U.S. presence.
IESI-BFC shares were 8 Canadian cents higher at C$23.96 on the Toronto Stock Exchange after the deal was announced. The stock has gained about 40 percent in the past year. ($1=$1.008 Canadian) (Reporting by Susan Taylor; editing by Janet Guttsman)