WASHINGTON (dpa-AFX) - Owens Corning (OC) said it has signed an agreement with private equity and investment advisory firm CVC Capital Partners to acquire Paroc Group, a producer of mineral wool insulation for building and technical applications in Europe, for an enterprise value of approximately 900 million euros. The transaction, is anticipated to close in early 2018.
Paroc is a European manufacturer of high-performance mineral wool insulation solutions for a variety of end markets. The company manufactures building insulation for thermal, fire and acoustic applications in residential and commercial construction.
It also manufactures technical insulation for HVAC systems; industrial processes; and the marine, offshore and original equipment manufacturer industries. Mineral wool products are customarily known as stonewool in Europe.
Owens Corning noted that the acquisition of Paroc will expand its mineral wool technology, grow its presence in the European insulation market, provide access to a variety of new end-use markets and also increase the company's sales mix of the Insulation business outside the U.S. and Canada to 35 percent.
Paroc's 2017 sales are estimated to be approximately 410 million euros, with adjusted earnings before interest, taxes, depreciation and amortization or EBITDA margins of slightly more than 20 percent.
Excluding transaction and integration costs, the transaction is expected to be immediately accretive to Owens Corning's 2018 earnings per share. It is also expected to yield a run rate of operational synergies of 15 million euros by the end of 2019.
Owens Corning plans to finance the acquisition through a combination of long-term debt and pre-payable bank financings.
Copyright RTT News/dpa-AFX
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