CRH To Divest Building Envelope Business To KPS Capital In $3.8 Bln Deal; Stock Down

(RTTNews) - Shares of CRH Plc (CRH, CRH.L) were losing around 3 percent in the morning trading in London after the building materials group said it has entered into a binding agreement to divest its Building Envelope business to KPS Capital Partners, LP for an enterprise value of $3.8 billion.

The consideration, payable on closing, includes cash of $3.45 billion together with a transfer of lease liabilities of $0.35 billion. Completion of the transaction is expected in mid-2022, subject to customary conditions and regulatory approvals.

The proceeds from the divestment will be incorporated into CRH's capital allocation resources.

Dallas, Texas -based Oldcastle Building Envelope Inc. or OBE comprises CRH's entire Building Envelope business. It is a vertically-integrated manufacturer, fabricator and distributor of architectural hardware, glass and glazing systems to customers primarily in North America.

In 2020, the Business generated IFRS EBITDA of $337 million, profit before tax of $210 million and gross assets at 30 June 2021 amounted to $2.5 billion.

CRH said it will announce full year results for 2021 on March 3.

BofA Securities and J.P. Morgan Securities LLC acted as financial advisors to CRH plc. Citi acted as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal counsel to KPS and its affiliates.

In London, CRH shares were trading at 3,278 pence, down 2.85 percent.