Beacon Roofing Supply Inc. has agreed to acquire Allied Building Products Corp. from Irish firm CRH PLC for $2.63 billion in cash, a deal that will expand its footprint to New York and double its size.
Beacon, a distributor of roofing materials with a market value of $2.4 billion, said the deal will make it one of the industry's largest publicly traded firms in North America, with a presence in all 50 states and annual revenue of $7 billion. It will finance the acquisition largely with debt.
The deal, announced by Beacon and CRH in separate statements Thursday, ramps up the Virginia-based company's North American expansion, allowing it to enter new local markets, particularly in New York, New Jersey and the upper Midwest.
In 2015, Beacon bought Roofing Supply Group from investment firm Clayton, Dubilier & Rice for $1.1 billion, giving it access to the Pacific Northwest.
The deal comes as U.S. President Donald Trump's administration is mapping out a $1 trillion infrastructure spending plan, designed partly to bolster industries such as construction, though the administration hasn't issued a detailed proposal.
"Together, we will leverage the strengths of both companies, while remaining committed to preserving the deep customer relationships that we have each cultivated over 150 years of combined experience," said Beacon Chief Executive Paul Isabella.
CRH--which supplies materials to the construction industry--said it would use the proceeds from the divestment to acquire German lime and aggregates business Fels for around EUR600 million ($706.5 million).
Founded in 1950, Allied is based in East Rutherford, New Jersey, and distributes products across 208 locations in 31 states, with 3,500 employees.
Beacon said it expects the deal to be completed in January 2018.
Write to Tapan Panchal at Tapan.Panchal@wsj.com
(END) Dow Jones Newswires
August 24, 2017 04:42 ET (08:42 GMT)