USG Corp, Chicago, IL, announced its specialty distribution subsidiary, L & W Supply, will acquire California Wholesale Material Supply Inc. for $280 million.

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California Wholesale Material Supply is a distributor of building materials with annual sales of $600 million. It has 30 locations in seven Western states and Mexico and nearly 900 employees.

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The acquisition is expected to help USG enhance L & W’s reach on the West Coast and in the Southwest.

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L & W Supply contributes about $2.5 billion to USG’s annual sales.

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USG also announced it would build a new plant in northern California to manufacture about 1 billion square feet of SHEETROCK brand wallboard each year. The facility will be on a 90-acre site at the Port of Stockton. Completion is expected in 2010.

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USG Corporation is a manufacturer and distributor of building systems through its United States Gypsum Company, USG Interiors, Inc. and L & W Supply Corporation subsidiaries. USG serves the residential and non-residential construction markets, repair and remodel construction markets, and industrial processes.

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