American Securities finalizes acquisition of Beacon interior business
Beacon, the roofing and exterior building products distributor, reported that it has completed the sale of its interior products and insulation businesses.
Under terms of the final deal, the interior products business has been sold to Foundation Building Materials (FBM), which is majority-owned by affiliates of equity firm American Securities LLC.
The cash price of the sale is $850 million, subject to net working capital and additional adjustments, Beacon said. The deal includes about 80 Beacon locations.
This move follows American Securities’ $1.37 billion acquisition of FBM, announced last November.
According to Beacon, the divestiture of its interior products business will accelerate the company’s goal of financial flexibility and additional growth in its core exteriors business. Beacon said that it plans to use about $750 million from the sale to reduce debt, strengthen its balance sheet and invest in growth.
“Finalizing the sale of interior products represents a transformational event for our company,” said Julian Francis, Beacon president and CEO.
“This transaction significantly expands our presence in many markets throughout the United States and provides attractive opportunities to drive revenue and profit growth while delivering meaningful long-term benefits to our customers, vendors, employees, and the communities we serve,” said Ruben Mendoza, president, CEO, and founder of FBM. “FBM has long been one of the largest specialty building product distributors of interior products, and we look forward to bringing together these two great businesses.”
Following the sale, Beacon said that it now operates more than 400 locations in North America. The company is based in Herndon, Va.
Earlier this week, Beacon reported first quarter net sales from continuing operations increased 11.4% to $1.58 billion from first quarter 2020 net sales of $1.42 billion.
FBM, based in Santa Ana, Calif., has more than 250 locations in the United States and Canada. The specialty building materials distributor has a focus on wallboard, suspended ceiling systems, metal framing, and complementary products.