Forterra Board approves Quikrete takeover offer

Sources: Forterra Inc., Irving, Texas; Quikrete Holdings Inc., Atlanta; CP staff

Principals project a fourth quarter closing on a $2.75 billion deal in which Quikrete Holdings will acquire all outstanding Forterra shares and debt. The cash transaction has the potential to bring under one roof the top two players in manufactured concrete drainage structures— integrating assets that have evolved from (pre-Quikrete) Hydro Conduit and Rinker Materials and (pre-Forterra) Hanson Pipe & Precast businesses. It likewise positions Quikrete to assimilate a nine-figure profit center outside concrete, Forterra’s ductile iron U.S. Pipe operations, perhaps emulating strategies attending its acquisition of steel product-heavy Contech Engineered Solutions. 

The Forterra Board of Directors unanimously approved a $24/share offer, representing a 38.5 percent premium to the company’s 90-day volume-weighted average stock price through mid-February. The top shareholder, a Lone Star Funds affiliate with a 53 percent stake, blessed the Quikrete overture by written consent. 

“This transaction delivers a compelling cash premium to our shareholders,” says Forterra CEO Karl Watson, Jr. “We admire Quikrete’s impressive 80-year history and commitment to delivering superior service and products. Over the past two years, we have made significant progress executing on our five improvement pillars of safety, plant-level operational discipline, enhanced commercial capabilities, working capital efficiency, and general and administrative expense effectiveness. [The Quikrete] announcement advances that progress and is a testament to our team members’ hard work and commitment to Forterra. We look forward to working with Quikrete to build on our positive momentum and achieve even greater success.”

“Forterra and Quikrete are an ideal strategic fit, and this combination is a natural next step, enabling us to better serve our customers across the company on their concrete projects from start to finish,” adds Quikrete Holdings CEO Will Magill. “We are excited to grow our capabilities in the potable water distribution market through Forterra’s well-respected U.S. Pipe business … and bring two great companies together.”

“Forterra Directors unanimously determined that entering into this agreement with Quikrete and becoming a private company again is the best path forward to maximize value,” observes Forterra Chairman Chris Meyer. “The transaction represents an exciting new chapter for Forterra—one that could not have been achieved without the leadership from the entire management team and dedication of all Forterra team members.”

Related articles

Cemex dispatches Rinker pipe and precast business in $500M Quikrete deal

Quikrete gains infrastructure market depth, Keystone brand in Contech deal

K. Watson Jr. shifts from Summit COO to Forterra CEO

Related posts