www.harriswilliams.de Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales under company number 7078852. Directors: : Mr. Ned Valentine, Mr. Paul Poggi, Mr. Thierry Monjauze and Mr. Aadil Khan, authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main, Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative (Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins. BUILDING PRODUCTS & MATERIALS INDUSTRY UPDATE │ DECEMBER 2015
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www.harriswilliams.de
Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales under company number 7078852. Directors: : Mr. Ned Valentine, Mr. Paul Poggi, Mr. Thierry Monjauze and Mr. Aadil Khan, authorisedand regulated by the Financial Conduct Authority.
Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main, Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative (Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins.
BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
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BUILDING PRODUCTS & MATERIALS GROUP OVERVIEW
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CONTENTS WHAT WE’RE READING PUBLIC MARKETS PUBLIC COMPARABLES M&A ACTIVITY
Harris Williams & Co. is pleased to present our Building Products and MaterialsIndustry Update for December 2015. This report provides commentary andanalysis on current capital market trends and merger and acquisition dynamicswithin the global building products and materials industry.
We hope you find this edition helpful and encourage you to contact us directly ifyou would like to discuss our perspective on current industry trends and M&Aopportunities or our relevant industry experience.
BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
OUR PRACTICE
Harris Williams & Co. is a leading advisor to the building products and materialsindustry. Our significant experience covers a broad range of end markets,industries, and business models.
U.S. BORROWING GROWTH SLOWS TO FOUR-YEAR LOW AHEAD OF RATE HIKE
GREEN AND HEALTHIER HOMES REPORT SHOWS REMODELERS ARE MAKING STRIDES
Concrete Construction 12/7/2015After many years of ups and downs and short-term solutions, Congress last week passed a bi-partisan, fully fundedtransportation bill. The Fixing America’s Surface Transportation (FAST) Act is the longest term highway infrastructure billin nearly a decade. The $305 billion, five-year bill, is a sign of relief to industry leaders and associations who have beenurging Congress to come up with a long-term bill.
Read the full article here.
Dodge 12/7/2015The Dodge Momentum Index fell 3.7% in November to 119.9 (2000=100) from its October reading of 124.5. TheMomentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning,which have been shown to lead construction spending for nonresidential buildings by a full year. Previously, the Indexhad posted large month-to-month increases in July (+4.6%) and September (+4.9%). The loss of momentum seen inOctober and again in November is returning the Index to a level that’s more consistent with the gentle upward trendin planning activity that began in 2012. The decline in November for the overall Index was the result of a 10.2% slide incommercial planning activity, while projects entering planning in the institutional sector increased by 5.3%.
Read the full article here.
Builder 12/11/2015Market Watch staffer Steve Goldstein reports on the lowest growth in borrowing seen in over four years during the thirdquarter. The decline of the stock market took away over $1 trillion in household wealth. In the second quarter businessdebt grew 8.4%; however, in the third quarter, it only grew 4.7%. Households, meanwhile, expanded their debt at aslim 1.5% rate. A category called “other loans and advances”, which includes margin accounts at broker/dealers, fellduring the quarter and helped offset 1.6% growth in mortgage debt and the 7.2% advance in consumer credit, whichencompasses auto, student and credit-card debt.
Read the full article here.
Construction Dive 11/20/2015Remodelers and builders are increasingly committed to green building, according to a McGraw Hill Construction’sDodge Construction Market Forecast released Wednesday morning. Nearly one-third (31%) of builders report thatover 60% of home projects they’ve built this year featured green technology. By 2020, more than half (51%) of buildersproject that they’ll reach that same level of green work.
Read the full article here.
CONSTRUCTION MATERIAL PRICES SLIDE FOR 5TH STRAIGHT MONTH
Construction Dive 12/11/2015Construction material prices fell 0.4% between October and November and 4.2% year-over-year, according to anAssociated Builders and Contractors analysis of Bureau of Labor Statistics data released Friday. November was the fifthconsecutive month of declines in construction industry inputs in the Producer Price Index. Only four of eleven inputprices rose between October and November: softwood lumber; prepared asphalt, tar roofing and siding products;plumbing fixtures and fittings; and concrete products.
Read the full article here.
BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
Announced Date
Target Vertical Business Description Acquirer
12/10/2015 Hathaway Building Materials
Building Products Distribution
Hathaway Building Materials distributes drywall, steel framing, lath, and plaster to the Southern California residential and commercial construction markets.
GMS Inc.
12/3/2015 Balboa Water Group, Inc. Building Products Balboa Water Group, Inc. designs, develops, manufactures, assembles, and supplies whirlpool bath and portable spa products for the leisure hot water industry.
AEA Investors Small Business Fund
12/2/2015 Badgerland Supply, Inc. Building Products Distribution
Badgerland Supply, Inc. supplies building materials in Wisconsin and Northern I llinois.
GMS Inc.
12/2/2015 Elite Door & Trim, Inc. Building Products Elite Door & Trim, Inc. manufactures doors, hardware, and trim products. National Millwork Inc.
12/1/2015 Rci Roofing Supply Company, Inc.
Building Products Distribution
Rci Roofing Supply Company, Inc. distributes building supplies and materials for residential and commercial projects throughout the Midwest.
Beacon Roofing Supply, Inc.
12/1/2015 Rhem, LLC Building Products Distribution
Rhem, LLC, doing business as E.J. Bartells, distributes, fabricates, and manufactures insulation, low-to-high temperature refractory, and HVAC products and accessories.
Distribution International, Inc.
11/30/2015 WinDoor Incorporated and LTE, LLC
Building Products WinDoor Incorporated manufactures extruded aluminum and v inyl sliding glass doors and window systems.
PGT Industries, Inc.
11/10/2015 M3 Glass Technologies Building Products M3 Glass Technologies produces and sells custom fabricated and decorative glass products.
LongWater Opportunities LLC
11/10/2015 Overhead Door Company of Burlington Inc.
Building Products Overhead Door Company of Burlington manufactures and installs integrated door and operator systems for commercial, industrial, and residential applications.
Installed Building Products, Inc.
11/9/2015 Team Wholesale, Inc. Building Products Distribution
Team Wholesale, Inc. supplies siding and windows to the Michigan construction market.
American Builders & Contractors Supply Co., Inc.
11/9/2015 Sierra Insulation Contractors, Inc. and Eco-Tect Insulation, Inc.
Building Products Sierra Insulation Contractors, Inc. and Eco-Tect Insulation, Inc. offer fiberglass and cellulose insulation installation serv ices.
Installed Building Products, Inc.
10/30/2015 Silver State Specialties, LLC Building Products Distribution
Silver State Specialties, LLC supplies building products to contractors and homeowners.
United Subcontractors, Inc.
10/28/2015 Heavy Materials, LLC and Spartan Concrete Products, LLC
Building Materials Heavy Materials, LLC and Spartan Concrete Products, LLC manufacture ready-mixed concrete and aggregates.
U.S. Concrete, Inc.
10/27/2015 Building Supply Association, Inc.
Building Products Distribution
Building Supply Association, Inc. distributes exterior-building products for housing contractors / builders.
U.S. LBM Holdings, LLC
10/20/2015 HomeXterior Building Supply, Inc.
Building Products Distribution
HomeXterior Building Supply, Inc. distributes building products to contractors in the United States.
American Builders & Contractors Supply Co., Inc.
10/19/2015 Florida Screen Enterprises Inc.
Building Products Florida Screen Enterprises Inc. manufactures residential and commercial window screens, patio doors, roll formed shapes, and associated hardware.
The RiteScreen Company, LLC
10/13/2015 Quantum Windows & Doors, Inc.
Building Products Quantum Windows & Doors, Inc. manufactures and sells hand-crafted wood windows and doors for residential and commercial markets in the United States.
Swiftsure Capital LLC
10/8/2015 Wilkinson Construction Company, Inc.
Building Materials Select assets of Wilkinson Construction Company, Inc. including an asphalt plant and aggregate extraction and processing property and equipment were acquired by Geneva Rock Products, Inc.
Geneva Rock Products, Inc.
10/5/2015 LaCantina Doors, Inc Building Products LaCantina Doors, Inc. designs and manufactures opening door systems. JELD-WEN, inc.
10/1/2015 Cretex Concrete Products North, Inc.
Building Materials Cretex Concrete Products North, Inc. develops, manufactures, and supplies various precast and prestressed products for the construction industry in the midwest and north eastern U.S.
Hanson Pipe & Precast LLC
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M&A TRANSACTIONS
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BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
Announced Date
Target Vertical Business Description Acquirer
9/28/2015 The Wantage Stone Building Materials The Wantage Stone comprises a site development quarry including an 80 acre land parcel and mining rights for an additional 77 acres of land.
U.S. Concrete, Inc.
9/28/2015 Grabber Construction Products, Inc.
Building Products Distribution
GRABBER Construction Products, Inc. manufactures and distributes fasteners and fastening systems for wood, metal, and drywall applications in the commercial and residential construction markets.
Svoboda Capital Partners LLC; Dot Foods, Inc.
9/25/2015 CEMEX, Inc., Gypsum Wallboard Business
Building Products Distribution
CEMEX, Inc., Gypsum Wallboard Business primarily distributes wallboard, metal framing, and acoustical ceiling products in the Southeastern U.S.
U.S. LBM Holdings, LLC
9/24/2015 Harvey Industries, Inc. Building Products / Building Products Distribution
Harvey Industries, Inc. manufactures and distributes building products to building industry professionals and homeowners in the United States.
Dunes Point Capital, LLC
9/22/2015 GBS Building Supply Building Products Distribution
GBS Building Supply supplies building and construction products through six locations across the Carolinas.
U.S. LBM Holdings, LLC
9/17/2015 Foundation Building Materials, LLC
Building Products Distribution
Foundation Building Materials, LLC, distributes a full range of building products through 70 locations across the United States.
Lone Star Funds
9/17/2015 Gravel and Sand site in Mankato
Building Materials Comprises a gravel and sand production property. City of Mankato
9/15/2015 Norandex Building Materials Distribution, Inc.
Building Products Distribution
Norandex Building Materials Distribution, Inc. distributes roofing, windows, decking, v inyl products, composites, shingles, siding, doors, and a wide variety of building accessories.
American Builders & Contractors Supply Co., Inc.
9/14/2015 Murray Supply Company, LLC
Building Products Distribution
Murray Supply Company, LLC, a wholesale distributor, supplies commercial and residential plumbing products in North Carolina.
Morrison Supply Company, LLC
9/10/2015 Karona, Inc. Building Products Karona, Inc. manufactures commercial and residential doors. JELD-WEN, inc.
9/2/2015 Skyline Group of Companies
Building Products Skyline Group of Companies prov ides commercial and residential roofing products for residential and commercial builders, homeowners, building owners, and property managers.
Thermal Systems KWC Ltd.
9/1/2015 Capitoline Products, Inc. Building Products Capitoline Products, Inc. manufactures post formed countertops, high pressure laminate panels, finished high pressure laminate panel component parts, and extended plywood.
VT Industries, Inc.
8/31/2015 WII Components Inc. Building Products WI I Components Inc., through its subsidiaries, manufactures and sells hardwood cabinet doors, hardwood components, and engineered wood products.
Quanex Building Products Corporation
8/28/2015 E&A Materials, Inc., Select Assets
Building Materials E&A Materials, Inc. mines and supplies construction aggregates. I t offers concrete sand, masonry sand, fill sand, asphalt sand, rocks, gravel and other specialty products.
U.S. Concrete, Inc.
8/27/2015 C.R. Laurence Co., Inc. Building Products C.R. Laurence Co., Inc. designs, engineers, manufactures, and supplies architectural hardware for glazing, railing, architectural, construction, industrial, food serv ice, and automotive industries.
Oldcastle BuildingEnvelope, Inc.
8/20/2015 Robert Bowden, Inc. Building Products Robert Bowden, Inc. manufactures, assembles, sells, installs, and serv ices various building materials for construction professionals and homebuilders in Georgia.
Building Materials Holding Corporation
8/19/2015 Superior Manufacturing Group, Inc.
Building Products Superior Manufacturing Group, Inc. manufactures floor mat products. Checkers Industrial Safety Products, Inc.
8/12/2015 Quest Construction Products, LLC
Building Products Quest Construction Products, LLC manufactures protective systems and coatings for the construction industry.
Building Materials Corporation of America, Inc.
8/11/2015 Lindab Inc. Building Products Lindab Inc. engages in the development, manufacture, and marketing of sheet metal products for the heating, ventilation, and air conditioning (HVAC) industry.
Ductmate Industries, Inc.
8/4/2015 Martin Marietta Materials, Inc., California Cement Business Assets
Building Materials Comprises Marietta Materials, Inc.'s, California cement business assets (excludes Clinker grinding plant in Crestmore).
CalPortland Company, Inc.
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M&A TRANSACTIONS
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BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
Announced Date
Target Vertical Business Description Acquirer
8/4/2015 Three Aggregates Facilities and Seven Ready-Mixed Concrete Operations
Building Materials Announced the acquisition of three aggregates facilities and seven ready-mixed concrete operations in Arizona and New Mexico during the 2nd quarter of 2015.
Vulcan Materials Company
8/4/2015 Midwest Millwork, Inc. Building Products Midwest Millwork, Inc. manufactures cabinets, doors, millwork, windows, hardware, plywood, framing lumber, and building materials.
Bliffert Lumber & Fuel Company, Inc.
8/3/2015 Alaska Industrial Hardware, Inc.
Building Products Distribution
Alaska Industrial Hardware, Inc. operates as a retailer and distributor of hand and power tools, builder hardware, contractor and industrial supplies, and maintenance and safety products in Alaska.
Bering Straits Native Corporation
8/3/2015 MGM Industries, Inc. Building Products MGM Industries, Inc. manufactures custom painted v inyl windows and doors for new construction and replacement projects.
Custom Window Systems, Inc.
7/31/2015 Beatrice Concrete Company, Inc.
Building Materials Beatrice Concrete Company, Inc. produces sand, gravel, and crushed rock.
NEBCO, Inc.
7/30/2015 Mayner's Fortune Limestone Property
Building Materials Mayner's Fortune consists of a two kilometer thick metasedimentary sequence hosting six limestone units south west of Terrace, B.C.
Durango Resources Inc.
7/29/2015 Structus Building Technologies, Inc.
Building Products Structus Building Technologies, Inc. designs and manufactures building products for the drywall industry.
CertainTeed Gypsum, Inc.
7/29/2015 U.S. LBM Holdings, LLC Building Products Distribution
U.S. LBM Holdings, LLC, through its subsidiaries, distributes building materials in the Midwest, Northeast, Southeast, Mid-Atlantic, and Western United States.
Kelso & Company
7/29/2015 Brass and Vinyl Assets of Watts Water Technologies
Building Products Select assets of Watts Water Technologies, Inc., including facilities related to brass fittings, brass & tubular and v inyl tubing product lines for homes.
Sioux Chief Manufacturing Company, Inc.
7/27/2015 Roofing Supply Group, LLC Building Products Distribution
Roofing Supply Group, LLC distributes and markets roofing materials and related building products in the United States.
Beacon Roofing Supply, Inc.
7/22/2015 Interline Brands Inc. Building Products Distribution
Interline Brands, Inc., together with its subsidiaries, operates as a distributor and direct marketer of broad-line maintenance, repair, and operations products in the United States.
The Home Depot, Inc.
7/21/2015 Madawaska Doors, Inc. Building Products Madawaska Doors, Inc. manufactures and markets wooden doors. Plaintree Systems Inc.
7/17/2015 House of Doors, Inc. Building Products Distribution
House of Doors, Inc. supplies, installs, and serv ices commercial and residential sectional doors, rolling steel doors, dock equipment, and wood carriage house doors.
Material Handling Serv ices, LLC
7/15/2015 Cali Bamboo, LLC Building Products Cali Bamboo, LLC manufactures green building products for residential and commercial projects.
High Road Capital Partners
7/14/2015 Better Life Technology, LLC Building Products Better Life Technology, LLC manufactures and supplies roll-out garage and concrete basement floor covers worldwide.
Century Park Capital Partners, LLC
7/2/2015 BD Enterprises, Inc. Building Products Distribution
BD Enterprises, Inc., doing business as Single Source Cabinet Supplies, distributes and sells laminates, millwork, and cabinetry supplies.
Richelieu Hardware Ltd.
6/30/2015 Advanced Flooring and Design LLC
Building Products Advanced Flooring and Design LLC manufactures floor covering and interior finish products to builders and homebuyers.
Interior Specialists, Inc.
6/24/2015 Golden State Window & Door Design
Building Products / Building Products Distribution
Golden State Window & Door Design supplies doors, windows, molding, and mantles to residential and commercial customers.
Golden State Lumber, Inc.
6/23/2015 C.H.I . Overhead Doors, Inc.
Building Products C.H.I . Overhead Doors, Inc. manufactures residential, commercial, rolling steel, and garage doors for residential and business applications.
KKR & Co. L.P.
6/19/2015 Craft Equipment Company Building Products Distribution
Craft Equipment Company distributes material handling, storage, and waste reduction equipment in Alabama, Florida, Georgia, South Carolina, and Tennessee.
Material Handling Serv ices, LLC
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REPRESENTATIVE BUILDING PRODUCTS & MATERIALS TRANSACTIONS
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BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
has been acquired by
a portfolio company of
Select Atlanta, Georgia aggregates assets of LaFarge SA have been acquired
BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
Harris Williams & Co. has a broad range of industry expertise, which creates powerful opportunities.Our clients benefit from our deep-sector experience, integrated industry intelligence andcollaboration across the firm, and our commitment to learning what makes them unique. For moreinformation, visit our website.
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HARRIS WILLIAMS & CO.
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BUILDING PRODUCTS & MATERIALSINDUSTRY UPDATE │ DECEMBER 2015
Bloomberg
Builder Online
Building Design & Construction
Building-Products.com
Bureau of Economic Analysis
Concrete Construction
Construction Dive
Dodge Data & Analytics
Eurostat
Floor Daily
Freedonia
Global Industry Analysts
IBIS
NAHB
New York Times
PNC Economic Outlook
S&P Capital IQ
S&P Leveraged Commentary & Data
The Wall Street Journal
Thomson Financial – SDC Database
Thomson Reuters
U.S. Census Bureau
DISCLOSURES
SOURCES
Harris Williams & Co. (www.harriswilliams.com and www.harriswilliams.de) is a preeminent middle market investment bank focused on the advisory needs of clients worldwide. The firm has deep industry knowledge, global transaction expertise, and an unwavering commitment to excellence. Harris Williams & Co. provides sell-side and acquisition advisory, restructuring advisory, board advisory, private placements, and capital markets advisory services.
Harris Williams & Co. Ltd is a private limited company incorporated under English law having its registered office at 5th Floor, 6 St. Andrew Street, London EC4A 3AE, UK, registered with the Registrar of Companies for England and Wales under company number 7078852. Directors: Mr. Ned Valentine, Mr. Paul Poggi, Mr. Thierry Monjauze and Mr. Aadil Khan, authorised and regulated by the Financial Conduct Authority.
Harris Williams & Co. Ltd Niederlassung Frankfurt (German branch) is registered in the Commercial Register (Handelsregister) of the Local Court (Amtsgericht) of Frankfurt am Main, Germany, under registration number HRB 96687, having its business address at Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany. Permanent Representative (Ständiger Vertreter) of the Branch Niederlassung: Mr. Jeffery H. Perkins.
The information and views contained in this report were prepared by Harris Williams & Co. (“Harris Williams”). It is not a research report, as such term is defined by applicable law and regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular trading strategy. The information contained herein is believed by Harris Williams to be reliable, but Harris Williams makes no representation as to the accuracy or completeness of such information. Harris Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to, have positions in and effect transactions in securities of companies mentioned herein and also may provide, may have provided, or may seek to provide investment banking services for those companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the securities, options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report constitute Harris Williams’ judgment and are subject to change without notice. The financial instruments discussed in this report may not be suitable for all investors, and investors must make their own investment decisions using their own independent advisors as they believe necessary and based upon their specific financial situations and investment objectives. Also, past performance is not necessarily indicative of future results. No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams’ prior written consent.