(Adds share prices and chief executive quotes)
Boral Ltd (BLD), Australia's biggest supplier of construction materials and building products, said on Monday it agreed to buy U.S. firm Headwaters Inc
for $2.6 billion in a deal that will double the size of Boral's U.S. business. The purchase offer of $24.25 per share, which is subject to the approval of Headwaters shareholders and regulatory approval, represents a 20 percent premium on Friday's closing price of $20.21 per Headwaters share. It will be funded by an A$2 billion ($1.47 billion) share issue, as well as borrowing and Boral's existing cash, Boral said in an announcement to the Australian stock exchange.
Chief Executive Mike Kane said the deal would provide cost savings of around $100 million per annum within four years of closing.
"The businesses of Headwaters are highly complementary with Boral's existing U.S. operations -– in fly ash, roofing, stone and light building products," Kane said in the statement.
Headwaters Chief Executive and Chairman Kirk A. Benson said the combined group would be one of the "leading manufacturers and distributors of building products and construction materials for infrastructure, new residential, repair and remodel, commercial and institutional construction.”
Boral shares closed at A$6.15 on Friday.
($1 = 1.3652 Australian dollars)
