Saint-Gobain has agreed to sell its U.S.-based PVC Pipe & Foundations business to North American Pipe Corp., a subsidiary of Westlake Chemical Corp. (NYSE: WLK), Houston, TX, for $175 million, representing 7.2 times 2012 EBITDA of $24 million.
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Manufactured by Saint-Gobain’s Exterior Products Division within the Construction Products Sector and marketed under the CertainTeed brand, these polyvinyl chloride pipes and fittings are used in various agricultural and industrial applications. The business employs 200 people and has production sites in Lodi, CA, and McPherson, KS.
The divestiture furthers Saint-Gobain’s Exterior Products Division’s strategic refocusing on the habitat market. CertainTeed, with its insulation, wallboard, roofing, siding and ceilings products designed specifically for North American homes and buildings, will then be fully focused on the construction market (especially residential), allowing it to fully benefit from the further upturn in this market.
Proceeds from the transaction, expected to close in the second quarter, will be used primarily to pursue the group’s acquisition strategy, focused on small- or medium-sized acquisitions.