Building Materials Supplier Owens Corning Agrees To Buy Masonite In $3.9B Deal, Expects $13B Revenue Boost
Portfolio Pulse from Vandana Singh
Owens Corning Inc (NYSE:OC) has agreed to acquire Masonite International Corporation (NYSE:DOOR) for $133.00 per share in a deal valued at approximately $3.9 billion. This acquisition, expected to close mid-2024, is anticipated to boost Owens Corning's revenue to $12.6 billion and expand its North American residential market share. The deal is financed through cash and $3 billion in debt from Morgan Stanley Senior Funding Inc. Masonite had previously terminated a merger agreement with PGT Innovations Inc (NYSE:PGT), opting not to submit a revised offer against a superior proposal from MITER Brands. Owens Corning also plans to review strategic alternatives for its global glass reinforcements business.
February 09, 2024 | 4:34 pm
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NEUTRAL IMPACT
Masonite terminated a previous merger agreement with PGT Innovations, opting not to submit a revised offer against a superior proposal from MITER Brands.
While the termination of the merger agreement with PGT Innovations and the decision not to submit a revised offer might have implications for PGT, the direct impact on its stock price in the short term is uncertain, hence a neutral score.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
Masonite's shares surged 35.0% following the announcement of its acquisition by Owens Corning. The deal represents a 38% premium over Masonite's closing share price on February 8.
The acquisition announcement has already positively impacted Masonite's stock price, reflecting investor optimism. The premium offered by Owens Corning suggests a strong valuation for DOOR, likely leading to continued positive short-term price movement.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 95
POSITIVE IMPACT
Owens Corning's acquisition of Masonite for $3.9 billion is expected to significantly boost its revenue and expand its market share in North America. The deal is financed through cash and debt, with expectations to maintain a healthy debt-to-EBITDA ratio.
The acquisition of Masonite by Owens Corning is a significant strategic move that is expected to boost revenue and market share, indicating a positive outlook for OC's stock in the short term. The financing strategy and expected debt-to-EBITDA ratio suggest financial stability post-acquisition.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 90