Comex suing Sherwin-Williams over botched deal
Mexican paint company Consorcio Comex is reportedly suing Sherwin-Williams over the botched deal it terminated last month, alleging that the company had not demonstrated a sufficient effort to follow through on the terms of the deal.
Sherwin-Williams drafted the stock purchase agreement last September, which stipulated that either party may terminate the deal in the event that the closing of the acquisition did not occur on or prior to March 31, 2014. Mexico’s Federal Economic Competition Commission rejected the bid twice, claiming that the acquisition would create monopoly conditions in Mexico’s paint market.
Comex is asking the International Chamber of Commerce to arbitrate the dispute, but is not indicating how much it is seeking in damages.
The deal, initially announced in November 2012, came at a price tag of $2.34 billion.
LP and Ainsworth call off their deal
Not that no one saw it coming, but Louisiana-Pacific Corporation and Ainsworth Lumber Co. have officially terminated their acquisition bid after months of regulatory delays.
In a joint statement released Wednesday, the companies explained that they could not obtain regulatory approval without lengthy and expensive litigation with U.S. and Canadian regulatory authorities.
“We believe this transaction would have led to positive outcomes for customers, employees and shareholders, and fundamentally disagree with the analysis by antitrust agencies of the competitive dynamics of our industry," said LP CEO Curt Stevens. "Our business experience, supported by expert economic analysis, continues to be that North America is an integrated market for structural panels. We will continue to compete on a continent-wide basis but feel we have no choice but to terminate the agreement rather than accept the distraction, disruption, costs and risk of litigating this matter in both the U.S. and Canada, where the process could take upwards of a year.”
“Although we are disappointed with this outcome, we look forward to advancing the ongoing growth and success of our business," added Ainsworth CEO Jim Lake. "Our strong competitive positioning, combined with our additional low cost capacity and strong balance sheet profile will allow us to capitalize on the expected recovery in the U.S. housing market and continued growth in our export markets."
The agreement, dated Sept. 4, 2013, involved the acquisition of Ainsworth’s outstanding common shares by LP. The $1.1 billion deal was aimed at helping LP make the most of the housing recovery by leveraging Ainsworth’s resources and access to international growth markets.
Stock upgrades component capacity
Raleigh, North Carolina-based Stock Building Supply opened two new structural component plants, one in the Raleigh-Durham, North Carolina, market and the other near Salt Lake City.
In Middlesex, North Carolina, production of roof and floor trusses recently began in a 36,000-sq.-ft. location. This facility will join existing store and distribution locations in Raleigh, Apex, Johnston County and Franklin County to serve Raleigh-Durham and adjacent markets in North Carolina.
"Our sales and service teams are excited about this increased ability to provide local home builders and remodeling contractors with a market-leading structural component offering, which includes trusses, prefabricated wall panels, engineered wood and the unparalleled customer service provided by our associates,” said Rick Vancil, general manager of the Raleigh-Durham market.
In Salt Lake City, roof and floor truss manufacturing has been relocated to a larger and more strategically positioned 60,000-sq.-ft. facility. This new location, serviced by rail spur access, will also provide additional capacity for lumber and building materials distribution. It joins an existing component plant in Lindon and store locations in West Jordan, Layton and Park City.
Fritz Froerer, general manager of the Utah market, said: "We have served home builders and contractors in the Salt Lake Valley for over 100 years, and structural components are a key element of our product and service offering. This new location will allow us to build on our local leadership with enhanced production capacity, reduced lead times and continued high standards for quality."
The company now has 15 component plants. In all, Stock operates 69 facilities across 14 states.