James Hardie Takes Bold Step with Azek Acquisition
Deal News | Mar 24, 2025 | EIN
Global building products giant James Hardie has announced its acquisition of US-listed Azek in one of the largest Australian Stock Exchange-listed deals in recent memory. This acquisition, valued at US$8.74 billion (A$13.87 billion), includes Azek's net debt of US$386 million. Azek, recognized for its high-performance, low-maintenance, and environmentally sustainable outdoor living products, offers complementary offerings to James Hardie’s current portfolio. The merger aims to establish a robust exterior and outdoor living building products platform, integrating siding, exterior trim, decking, railing, and pergolas. Under the agreement, Azek shareholders will gain US$26.45 in cash and 1.0340 shares of James Hardie for each Azek share they own, representing a significant premium over Azek's stock price over the preceding trading days. The transaction, contingent on Azek shareholder approval, is expected to conclude in the second half of the fiscal year 2025. The combined organization anticipates achieving notable cost and commercial synergies, enhancing its market presence in North America. Although shares in James Hardie fell 14% upon the announcement, indicative of market skepticism, the company maintains a positive outlook regarding potential synergies and growth opportunities from the merger.
Sectors
- Building Products
- Construction Materials
Geography
- United States – Azek is a US-listed company and much of the operational and growth discussion centers around the North American market.
- Australia – James Hardie is listed on the Australian Stock Exchange (ASX), and its market responses are noted in the article.
Industry
- Building Products – The merger involves James Hardie, a global leader in building products, and Azek, a manufacturer of outdoor living products.
- Construction Materials – Both companies are significant players in construction materials, with offerings like siding, decking, and railing.
Financials
- US$8.74 billion – The overall deal value for James Hardie's acquisition of Azek.
- US$386 million – Azek's net debt included in the acquisition deal.
- US$26.45 in cash and 1.0340 shares of James Hardie per Azek share – The consideration for Azek shareholders under the deal.
- 26% premium – The premium of the deal over Azek's 30-day VWAP before March 21, 2025.
- $1 billion-plus – The expected annual free cash flow of the combined company after synergies.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| James Hardie | Acquirer | Company | A global leader in the production of building products. |
| Azek | Target Company | Company | A US-listed manufacturer of high-performance outdoor living products. |
| Aaron Erter | CEO of James Hardie | Person | The CEO of James Hardie who commented on the acquisition. |