James Hardie to Sell Fermacell to Holcim for €840 Million

James Hardie (ASX:JHX) Industries announced that, through its wholly owned subsidiaries James Hardie International Group Limited and James Hardie Holdings Limited, it has entered into a share purchase agreement to sell the equity interests of certain subsidiaries comprising its European fibre gypsum and cement-bonded products business, Fermacell, including the fermacell and Aestuver brands, to Holcim Westbeteiligungs GmbH, a wholly owned subsidiary of Holcim Ltd, for €840 million in cash, subject to customary adjustments for net debt and working capital as of closing. The company said €840 million is currently approximately US$980 million. The transaction does not include James Hardie's European fiber cement operations, which the company intends to wind down before closing pursuant to procedures contemplated by the purchase agreement, subject to customary legal, regulatory and employee consultation requirements including competent works councils. Completion is subject to customary closing conditions including required antitrust approvals and completion of employee consultation processes where required, and is expected to occur in the first half of calendar year 2027. The agreement may be terminated in certain circumstances, and under specified circumstances the purchaser may be required to pay the sellers a termination fee of €15 million.

James Hardie said it intends to deploy the transaction proceeds to accelerate deleveraging and return capital to shareholders, with approximately US$600 million expected to be used to repay debt, accelerating progress toward its stated target of net leverage below 2.0 times by 30 September 2027. Its board of directors has separately authorised a new share repurchase program of up to US$250 million, which may be effected through open-market purchases, privately negotiated transactions, accelerated share repurchases or other methods depending on factors including stock price, trading volume and market conditions; the filing states the program does not obligate the company to repurchase any of its ordinary shares. The company said the transaction is expected to be accretive to its margin profile and return on invested capital post-close. Fermacell, including the fermacell and Aestuver brands, will continue to be led by Christian Claus, CEO of Fermacell and President of James Hardie Europe. Goldman Sachs & Co. LLC is serving as financial advisor to James Hardie and DLA Piper is serving as legal advisor.