Category: Company News / Building and Construction / Multinationals / Takeovers / Business, Economics and Finance
Boral acquires US building materials firm Headwaters in $3.5b deal
Monday, 21 Nov 2016 09:00:14 | Thuy Ong

Boral logo.
Construction multinational Boral says it will acquire US-based building products manufacturer Headwaters in a deal worth $US2.6 billion ($3.5 billion).
The acquisition is still subject to Headwaters shareholder approval and regulatory approval but Boral, Australia's largest supplier of construction materials, expects the deal to be completed mid-2017.
"The businesses of Headwaters are highly complementary with Boral's existing US operations - in fly ash, roofing, stone and light building products," said Mike Kane, chief executive and managing director of Boral in a statement to the ASX.
"It's this strong alignment that means we can deliver substantial value through synergies - ramping up approximately $US100 million per annum of synergies within four years of closing."
Boral is also hoping to take full advantage of President-elect Donald Trump's commitment to increased infrastructure spending by supplying more of the materials that will be needed for such construction.
The deal represents $US24.25 per share in cash, making it a premium on Headwaters' Friday closing price of $US20.09.
The takeover cost will be funded by a share issue worth over $2 billion, existing cash and taking on debt.
"While this acquisition is significant in scale, we have maintained a disciplined approach to reviewing growth opportunities in the USA," said Boral chairman Brian Clark.
"Headwaters has been rigorously assessed and with its highly complementary portfolio of assets, which are strategically aligned with a number of Boral's existing US businesses, this is a highly compelling acquisition for Boral."
Boral's equity raising will be conducted at $4.80 per share, which is a 22 per cent discount to its close of $6.15 on Friday.
Shares in Boral are currently in a trading halt which will be lifted on Thursday.
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