(Reuters) -Australia’s top construction materials maker Boral Ltd said on Monday it would sell its North American fly ash business for $755 million, marking its exit from the market as it looks to focus on its domestic business.
The sale to Eco Material Technologies, which is backed by private equity firms One Equity Partners and Quadrant Management, means Boral will have sold its U.S. businesses for a combined more than A$4 billion ($2.80 billion).
The deal “supports our strategy to refocus on our construction materials business in Australia,” Chief Executive Officer Zlatko Todorcevski said.
Boral has been selling its U.S. businesses since last year, as it retreats from a seven-year global expansion strategy that saw a spree of offshore acquisitions leading to a hefty writedown in 2020.
Its domestic business, which generates more than half of its revenue, has meanwhile benefited from a strengthening real estate market as record low interest rates led property prices to record highs.
This prompted multiple takeover offers this year from its largest shareholder, billionaire media tycoon Kerry Stokes’ Seven Group Holdings.
Seven Group now owns nearly 70% of Boral, having built up its stake from nearly 20% in September last year. In July, Boral appointed Seven’s boss Ryan Stokes as its chairman.
Boral sold its U.S. building products business to Westlake Chemical Corp for $2.15 billion in June. It had said late last year it would also sell its stake in U.S.-based Meridian Brick.
The proceeds from the sale of the 40-year old U.S. fly ash business, expected to complete next year, will be reinvested and the board will determine the most appropriate way to return surplus capital to shareholders later, Boral said.
Its shares, which have jumped more than a fourth this year, gained as much as 2.8% to A$6.34 in morning trade.
($1 = 1.4290 Australian dollars)
(Reporting by Shashwat Awasthi; Editing by Daniel Wallis and Rashmi Aich)
