KPS Capital Partners LP (KPS) announced that it has signed a definitive agreement to acquire Oldcastle BuildingEnvelope® (OBE) from CRH plc for approximately $3.45 billion in cash through a newly formed affiliate. Completion of the transaction is expected in mid-2022 and is subject to customary closing conditions and approvals, according to a press release.
Speculations regarding the possible $3 billion sale were reported late last year, which caused CRH’s stocks to rise. OBE, headquartered in Dallas, has over 6,700 employees and operates 84 manufacturing and distribution facilities in five countries.
“The entire OBE management team looks forward to partnering with KPS as the company begins its journey as an independent company. KPS has an exemplary track record of investing in and improving manufacturing businesses, and we are exceedingly confident that they are the right partner to help us execute on our strategic plan. We will continue to build on our industry-leading reputation for quality, reliability and product innovation. KPS’ experience with manufacturing businesses and the significant capital resources available will allow us to invest in our commercial and operational growth strategy. We intend to expand our capabilities as a customer-oriented solutions provider in architectural hardware, glass and glazing markets. We are very excited about OBE’s future opportunities and we have found a great partner in KPS to capture them,” says Liz Haggerty, OBE CEO.
KPS, a global private equity firm founded in 1991, says it makes controlling equity investments in manufacturing and industrial companies across diverse industries and has approximately $13.1 billion of assets under management as of December 31, 2021. The firm says it maintains working relationships with the major manufacturing, industrial and service unions in North America and Europe, including the United Steelworkers. Speira, a European manufacturer of advanced rolled aluminum products, is among the company’s active investments. According to the company’s website, KPS has completed over 100 controlling investments through six institutional investment funds, comprising 46 platform investments and 65 follow-on acquisitions in industries such as basic materials, branded consumer, healthcare and luxury products, automotive parts, capital equipment and general manufacturing.
“We are thrilled to acquire North America’s largest provider of architectural hardware, glass and glazing systems. OBE is the only ‘one-stop shop’ for every critical product a glazing industry customer needs, and the company serves attractive, growing end-markets. We intend to drive profitable growth by providing the company with the financial resources to invest in commercial and operational excellence… We look forward to partnering with OBE’s talented employees and management team under the leadership of president and chief executive officer Liz Haggerty to accelerate the company’s value creation opportunities,” says Raquel Vargas Palmer, co-managing partner of KPS.
BofA Securities and J.P. Morgan Securities LLC acted as financial advisors to CRH plc. Citi acted as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal counsel to KPS and its affiliates.