Building products maker Masco is spinning off its installation and other services division in a series of moves aimed at boosting shareholder value.
Shares of the maker of Delta faucets, Behr paint and Merillat cabinets climbed more than 8 percent in Tuesday premarket trading.
The installation and other services unit includes Masco Contractor Services, an insulation installer, and Service Partners, a distributor of residential insulation products and related accessories.
Once the separation takes place, Masco will remain headquartered in Taylor, Michigan. The company will continue to be listed on the New York Stock Exchange under the "MAS" ticker symbol.
Masco said the spun-off services business would be headquartered in central Florida, but did not give a proposed name for the company. Those businesses accounted for about $1.4 billion of Masco's $8.17 billion in 2013 revenue.
The separation is expected to be completed by the middle of next year. It still needs approval from Masco's board.
Masco Corp. said that it is also starting a repurchase program for 50 million shares of its common stock. This is approximately 14 percent of its outstanding stock. The repurchases are expected to be made over several years, starting in 2014.
The company is also looking to lower its corporate expenses and simplify its organizational structure. It foresees annual savings of $35 million to $40 million, with an estimated charge of about $30 million over the next several quarters.