Sharechat Logo

Fletcher starts sale process for Formica, private equity firms likely bidders, report says

Monday 13th August 2018

Text too small?

The sales process for Fletcher Building's Formica unit is about to get underway, and is most likely to attract the interest of private equity buyers, the Australian newspaper reported.

Flyer documents are being sent out to buyers who will receive information memorandums for the business next month, with the hope a sale is finalised by Christmas, the newspaper said without detailing where it got the information. The newspaper named buyout funds such as Lone Star, which owns building materials firm Arclin, Bain Capital and Platinum among potential buyers.

The Auckland-based construction and building products company announced plans in April to sell its Formica and steel roofing tiles businesses after a strategic review under new chief executive Ross Taylor which will see it retreating to its main New Zealand and Australian markets following losses in its construction business. In February, Morningstar valued the international division at $1.36 billion and Formica alone at $730 million. Fletcher paid US$700 million to buy Formica Corp from private equity owners Cerberus Capital Management and Oaktree Capital Management in 2007.

The Australian newspaper report suggested Formica, which makes high pressure laminates used on desks, and for interiors such as kitchen tops, cupboard linings and display units, could be worth about A$1 billion. 

Fletcher shares last traded at $6.92 and have fallen 8.7 percent over the past year. Of analysts polled by Reuters, eight rate the stock as a 'hold', one a 'sell' and one a 'strong sell'.

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

PwC says NZ banks would effectively hold 27.1% equity if RBNZ proposals are adopted
Terra Vitae says poor harvest to hit sales, earnings
Weak services sector growth raises concerns about NZ economic slowdown
National sticks to bob-each-way on US-China relations in new policy paper
Kiwi Property lifts annual profit 15% as valuations rise
Kiwi Property lifts annual profit 15% as valuations rise
Scales signals earnings growth from reshaped business
Steel & Tube cuts earnings outlook on margin squeeze, inventory restatement
Bankers' Assn says RBNZ bank capital proposals would hurt the economy
20th May 2019 Morning Report

IRG See IRG research reports