Building Products & Infrastructure | Q3 2016
THE BUILDING PRODUCTS & INFRASTRUCTURE TEAM GRANT HAMILTON BlackArch Partners, Managing Director Piper Jaffray, Edgeview Partners, Bank One
M.B.A. from University of Chicago’s Booth School of Business B.S. from Miami University Office:
(704) 414-6318
Cell: (704) 607-8756
[email protected]
PHIL ROSS BlackArch Partners, Associate Robinson, Bradshaw & Hinson, M&A Attorney J.D. from Wake Forest University School of Law, magna cum laude
B.B.A. in Accounting from East Tennessee State University, summa cum laude Office:
Charlotte, NC 227 West Trade Street | Suite 2200 Charlotte, NC 28202 (704) 414-6300
Houston, TX 4400 Post Oak Parkway | Suite 2370 Houston, TX 77027 (713) 380-4300
www.BlackArchPartners.com
(704) 414-6319
Cell: (704) 430-6955
[email protected]
KATHERINE HOWELL BlackArch Partners, Analyst Babson Capital Management, Private Finance Intern B.A. from Davidson College, cum laude Office:
(704) 414-6332
Cell: (336) 813-5046
[email protected]
STRICTLY CONFIDENTIAL
|2
PUBLIC COMPANY TRADING MULTIPLE TRENDS BY SUB-SECTOR 18.0x
Median TEV/EBITDA Multiple
16.0x
14.0x
12.0x
10.0x
8.0x
6.0x
Building Products
STRICTLY CONFIDENTIAL
Building Materials
Distribution & Retail
Engineering & Construction Services
|3
Building Products & Infrastructure Industry Update | Q3 2016
Comparable Public Company Analysis ($ in Millions Except Per Share Amounts) Market Data Price Company
Ticker
9/30/2016
52-Week High
LTM Financial and Performance Data Equity
Low
Value
TEV
(2)
Revenue
EBITDA
(1)
Valuation Multiples
EBITDA
3 Yr. Revenue
Margin
CAGR %
TEV/LTM: Revenue
EBITDA
Building Products Roofing, Siding & Decking Compagnie de Saint-Gobain S.A.
ENXTPA:SGO
$43.24
$47.34
$35.37
$23,950
$31,800
$43,658
$4,407
10.1%
(2.4%)
0.7x
Owens Corning
NYSE:OC
53.39
58.69
38.96
6,127
8,379
5,591
1,041
18.6%
2.6%
1.5x
8.0x
Kingspan Group plc
ISE:KRX
26.95
29.46
19.56
4,798
5,251
3,340
417
12.5%
20.4%
1.6x
12.6x
USG Corporation
NYSE:USG
25.85
30.84
15.85
3,773
5,125
3,864
607
15.7%
3.7%
1.3x
8.4x
Trex Co. Inc.
NYSE:TREX
58.72
64.36
31.11
1,815
1,855
461
108
23.5%
12.6%
4.0x
17.1x
Continental Building Products, Inc.
NYSE:CBPX
20.99
24.78
13.25
849
1,096
447
105
23.4%
0.0%
2.5x
10.5x
17.2%
3.1%
1.5x
9.4x
Median
7.2x
Windows & Doors ASSA ABLOY AB
OM:ASSA B
$20.34
$22.21
$17.14
$22,596
$25,395
$8,182
$1,502
18.4%
13.9%
3.1x
16.9x
Masonite International Corporation
NYSE:DOOR
62.17
72.75
45.14
1,901
2,326
1,964
211
10.8%
4.5%
1.2x
11.0x
Ply Gem Holdings, Inc
NYSE:PGEM
13.36
16.09
8.58
911
1,803
1,881
217
11.6%
16.2%
1.0x
8.3x
Griffon Corporation
NYSE:GFF
17.01
19.24
13.45
727
1,589
1,959
176
9.0%
1.6%
0.8x
9.0x
Quanex Building Products Corporation
NYSE:NX
17.26
21.66
15.33
591
860
874
92
10.5%
12.0%
1.0x
9.4x
Tyman plc
LSE:TYMN
3.64
4.00
2.88
644
831
504
77
15.3%
16.4%
1.6x
10.8x
PGT, Inc.
NASDAQGM:PGTI
10.67
14.05
8.69
522
744
413
61
14.8%
26.8%
1.8x
12.2x
11.6%
13.9%
1.2x
10.8x
Median Kitchen & Bath Masco Corporation
NYSE:MAS
$34.31
$37.38
$23.10
$11,330
$13,410
$7,313
$1,195
16.3%
(3.0%)
1.8x
11.2x
Fortune Brands Home & Security, Inc.
NYSE:FBHS
58.10
64.47
44.19
8,942
10,268
4,908
749
15.3%
8.9%
2.1x
13.7x
Caesarstone Ltd.
NASDAQGS:CSTE
37.71
43.52
27.31
1,327
1,300
523
126
24.1%
17.9%
2.5x
10.3x
American Woodmark Corp.
NASDAQGS:AMWD
80.57
89.89
57.04
1,314
1,119
974
115
11.8%
13.8%
1.1x
9.7x
15.8%
11.4%
2.0x
10.8x
Median Flooring Mohawk Industries Inc.
NYSE:MHK
$200.34
$216.58
$148.56
$14,856
$17,731
$8,631
$1,591
18.4%
10.6%
2.1x
11.1x
Interface Inc.
NASDAQGS:TILE
16.69
24.44
13.70
1,082
1,218
972
142
14.6%
0.9%
1.3x
8.6x
Armstrong Flooring, Inc.
NYSE:AFI
18.88
20.85
11.77
525
523
1,211
56
4.6%
0.0%
0.4x
9.4x
14.6%
0.9%
1.3x
9.4x
Median Electrical & Lighting Schneider Electric SE
ENXTPA:SU
$69.76
$71.48
$50.94
$40,585
$47,153
$28,472
$4,181
14.7%
2.4%
1.7x
11.3x
Acuity Brands, Inc.
NYSE:AYI
264.60
280.89
169.42
11,613
11,631
3,291
568
17.3%
16.4%
3.5x
20.5x
Hubbell Inc.
NYSE:HUBB
107.74
111.23
83.16
5,962
6,670
3,481
593
17.0%
3.6%
1.9x
11.2x
LSI Industries Inc.
NASDAQGS:LYTS
11.23
13.45
7.89
281
247
320
17
5.4%
3.8%
0.8x
14.4x
15.9%
3.7%
1.8x
12.8x
Median HVAC & Plumbing Ingersoll-Rand Plc
NYSE:IR
AO Smith Corp.
NYSE:AOS
Lennox International, Inc.
NYSE:LII
AAON Inc.
NASDAQ:AAON
$67.94
$68.97
$47.08
$17,528
$20,749
$13,476
$1,937
14.4%
8.1%
1.5x
10.7x
49.40
49.70
30.15
8,619
8,233
2,627
518
19.7%
7.4%
3.1x
15.9x
157.03
164.02
105.65
6,827
7,847
3,579
494
13.8%
4.5%
2.2x
15.9x
28.82
29.23
18.85
1,525
1,481
379
92
24.3%
6.6%
3.9x
16.1x
17.0%
7.0%
2.7x
15.9x
Median Subsector Median
Footnotes: (1) LTM refers to the most recent twelve-month period for which data was available (2) Total enterprise value equals equity value plus minority interest, preferred stock and net debt; net debt equals total debt less cash and cash equivalents
Strictly Confidential | BlackArch Partners | 4
11.1x
Building Products & Infrastructure Industry Update | Q3 2016
Comparable Public Company Analysis ($ in Millions Except Per Share Amounts) Market Data Price Company
Ticker
9/30/2016
52-Week High
LTM Financial and Performance Data Equity
Low
Value
TEV
(2)
Revenue
EBITDA
(1)
Valuation Multiples
EBITDA
3 Yr. Revenue
Margin
CAGR %
TEV/LTM: Revenue
EBITDA
Building Materials Aggregates, Cement & Concrete LafargeHolcim Ltd.
SWX:LHN
$53.42
$60.13
$34.33
$32,862
$56,031
$28,998
$2,087
7.2%
11.1%
1.9x
26.9x
CRH plc
ISE:CRG
33.46
34.78
21.78
27,779
36,492
29,938
3,040
10.2%
14.8%
1.2x
12.0x
HeidelbergCement AG
DB:HEI
94.24
95.76
65.98
18,700
26,596
14,893
2,640
17.7%
(0.6%)
1.8x
10.1x
CEMEX, S.A.B. de C.V.
NYSE:CX
7.94
9.09
3.50
11,116
26,534
12,884
2,603
20.2%
8.9%
2.1x
10.2x
Vulcan Materials Company
NYSE:VMC
113.73
127.20
78.83
15,134
17,025
3,607
961
26.6%
11.3%
4.7x
17.7x
Martin Marietta Materials, Inc.
NYSE:MLM
179.11
206.36
108.31
11,362
13,123
3,435
879
25.6%
23.0%
3.8x
14.9x
Boral Limited
ASX:BLD
5.17
5.67
3.92
3,847
4,517
3,212
379
11.8%
1.2%
1.4x
11.9x
Eagle Materials Inc.
NYSE:EXP
77.30
87.57
45.03
3,729
4,218
1,160
345
29.7%
13.0%
3.6x
12.2x
Summit Materials, Inc.
NYSE:SUM
18.65
24.60
13.12
1,399
3,036
1,547
318
20.6%
0.0%
2.0x
9.5x
U.S. Concrete, Inc.
NASDAQCM:USCR
49.66
69.66
40.42
698
1,038
1,079
127
11.8%
24.1%
1.0x
8.2x
19.0%
11.2%
1.9x
12.0x
Median Stone Headwaters Incorporated
NYSE:HW
United States Lime & Minerals, Inc.
NASDAQGS:USLM
$16.92
$21.25
$13.62
$1,254
$1,736
$956
$172
18.0%
12.1%
1.8x
10.1x
66.00
66.62
45.75
367
304
136
38
27.6%
0.2%
2.2x
8.1x
22.8%
6.2%
2.0x
9.1x
Median Lumber & Wood Products Louisiana-Pacific Corp.
NYSE:LPX
$18.83
$20.97
$13.31
$2,677
$2,949
$2,146
$273
12.7%
1.4%
1.4x
NM
Norbord, Inc.
TSX:OSB
25.68
25.89
14.63
2,198
2,921
1,699
314
18.5%
7.6%
1.7x
9.3x
West Fraser Timber Co. Ltd.
TSX:WFT
30.80
42.66
26.93
2,436
2,826
3,319
421
12.7%
8.5%
0.9x
6.7x
Canfor Corp.
TSX:CFP
11.10
16.20
9.11
1,474
2,009
3,234
367
11.4%
11.2%
0.6x
5.5x
Universal Forest Products Inc.
NASDAQGS:UFPI
98.49
110.97
57.11
2,000
1,999
3,035
202
6.6%
7.9%
0.7x
9.9x
Boise Cascade Company
NYSE:BCC
25.40
33.15
13.80
984
1,354
3,868
160
4.1%
6.9%
0.4x
8.5x
12.0%
7.8%
0.8x
8.5x
Median Timber & Forest Products Weyerhaeuser Co.
NYSE:WY
$31.94
$33.17
$22.06
$23,914
$32,798
$7,871
$1,765
22.4%
1.7%
4.2x
18.6x
Rayonier Inc.
NYSE:RYN
26.54
28.16
17.85
3,252
4,297
685
306
44.6%
(13.6%)
6.3x
14.0x
Deltic Timber Corporation
NYSE:DEL
67.73
72.74
50.84
823
1,060
211
40
19.1%
3.8%
5.0x
26.3x
22.4%
1.7%
5.0x
18.6x
Median Subsector Median
Footnotes: (1) LTM refers to the most recent twelve-month period for which data was available (2) Total enterprise value equals equity value plus minority interest, preferred stock and net debt; net debt equals total debt less cash and cash equivalents
Strictly Confidential | BlackArch Partners | 5
10.2x
Building Products & Infrastructure Industry Update | Q3 2016
Comparable Public Company Analysis ($ in Millions Except Per Share Amounts) Market Data Price Company
Ticker
9/30/2016
52-Week High
LTM Financial and Performance Data Equity
Low
Value
TEV
(2)
Revenue
EBITDA
(1)
Valuation Multiples
EBITDA
3 Yr. Revenue
Margin
CAGR %
TEV/LTM: Revenue
EBITDA
Distribution & Retail Distributors Wolseley plc
LSE:WOS
$56.71
$58.05
$41.85
$14,111
$15,367
$19,161
$1,380
7.2%
3.1%
0.8x
11.1x
Fastenal Company
NASDAQGS:FAST
41.78
49.99
34.45
12,073
12,348
3,937
892
22.7%
6.4%
3.1x
13.8x
HD Supply Holdings, Inc.
NASDAQGS:HDS
31.98
36.99
21.26
6,429
10,424
7,588
864
11.4%
(3.1%)
1.4x
12.1x
Watsco Inc.
NYSE:WSO
140.90
149.99
106.58
4,608
5,116
4,211
359
8.5%
4.6%
1.2x
14.2x
Beacon Roofing Supply, Inc.
NASDAQGS:BECN
42.07
48.96
32.21
2,514
3,668
3,740
285
7.6%
20.2%
1.0x
12.9x
Builders FirstSource, Inc.
NASDAQGS:BLDR
11.51
15.72
6.50
1,267
3,199
5,806
301
5.2%
64.8%
0.6x
10.6x
BMC Stock Holdings, Inc.
NASDAQGS:BMCH
17.73
21.50
12.14
1,178
1,573
2,452
136
5.6%
0.0%
0.6x
11.6x
CanWel Building Materials Group Ltd.
TSX:CWX
5.06
5.40
2.82
309
513
715
34
4.7%
8.8%
0.7x
15.2x
Bluelinx Holdings Inc.
NYSE:BXC
8.88
9.70
3.00
80
495
1,929
33
1.7%
(1.9%)
0.3x
15.2x
Hardwoods Distribution Inc.
TSX:HWD
14.23
15.02
11.47
303
327
468
30
6.4%
21.8%
0.7x
10.9x
Huttig Building Products Inc.
NASDAQCM:HBP
5.78
7.00
3.01
147
222
705
26
3.7%
8.5%
0.3x
8.6x
6.4%
6.4%
0.7x
12.1x
Median Retailers The Home Depot, Inc.
NYSE:HD
$128.68
$139.00
$109.62
$158,994
$175,919
$92,033
$14,566
15.8%
5.7%
1.9x
12.1x
Lowe's Companies, Inc.
NYSE:LOW
72.21
83.65
62.62
63,159
76,923
61,090
7,553
12.4%
5.6%
1.3x
10.2x
Tractor Supply Company
NASDAQGS:TSCO
67.35
97.25
66.77
9,002
9,073
6,510
809
12.4%
8.9%
1.4x
11.2x
Tile Shop Holdings, Inc.
NASDAQGS:TTS
16.55
21.05
11.67
853
870
319
62
19.5%
13.6%
2.7x
13.9x
14.1%
7.3%
1.7x
11.6x
Median Subsector Median
Footnotes: (1) LTM refers to the most recent twelve-month period for which data was available (2) Total enterprise value equals equity value plus minority interest, preferred stock and net debt; net debt equals total debt less cash and cash equivalents
Strictly Confidential | BlackArch Partners | 6
12.1x
Building Products & Infrastructure Industry Update | Q3 2016
Comparable Public Company Analysis ($ in Millions Except Per Share Amounts) Market Data Price Company
Ticker
9/30/2016
52-Week High
LTM Financial and Performance Data Equity
Low
Value
TEV
(2)
Revenue
EBITDA
(1)
Valuation Multiples
EBITDA
3 Yr. Revenue
Margin
CAGR %
TEV/LTM: Revenue
EBITDA
Engineering & Construction Services Engineering & Construction Skanska AB
OM:SKA B
$23.38
$23.60
$17.27
$9,570
$9,164
$17,358
$908
5.2%
3.5%
0.5x
10.1x
AECOM
NYSE:ACM
29.73
36.20
22.80
4,569
8,444
17,811
1,017
5.7%
29.7%
0.5x
8.3x
Fluor Corporation
NYSE:FLR
51.32
55.69
39.48
7,146
7,252
18,035
1,045
5.8%
(14.2%)
0.4x
6.9x
Jacobs Engineering Group Inc.
NYSE:JEC
51.72
55.89
34.76
6,280
6,216
11,441
679
5.9%
(0.1%)
0.5x
9.2x
SNC-Lavalin Group Inc.
TSX:SNC
39.26
44.54
27.79
5,898
5,467
7,065
545
7.7%
3.6%
0.8x
10.0x
Chicago Bridge & Iron Company N.V.
NYSE:CBI
28.03
46.39
26.12
2,892
4,769
11,414
1,010
8.8%
5.8%
0.4x
4.7x
EMCOR Group Inc.
NYSE:EME
59.62
60.33
40.98
3,625
3,710
7,379
402
5.4%
5.4%
0.5x
9.2x
Stantec Inc.
NYSE:STN
23.52
26.87
20.71
2,676
3,382
1,998
230
11.5%
15.5%
1.7x
14.7x
Tutor Perini Corporation
NYSE:TPC
21.47
25.98
10.16
1,056
1,763
4,935
195
3.9%
5.0%
0.4x
9.1x
KBR, Inc.
NYSE:KBR
15.13
19.94
11.61
2,156
1,383
4,284
222
5.2%
(17.2%)
0.3x
6.2x
5.8%
4.3%
0.5x
9.1x
Median Contractors & Homebuilders Lennar Corporation
NYSE:LEN
$42.34
$52.50
$37.14
$9,522
$15,770
$10,519
$1,293
12.3%
25.1%
1.5x
12.2x
DR Horton Inc.
NYSE:DHI
30.20
34.56
22.97
11,243
13,682
11,589
1,346
11.6%
26.4%
1.2x
10.2x
PulteGroup, Inc.
NYSE:PHM
20.04
22.40
14.61
6,886
9,456
7,237
976
13.5%
9.0%
1.3x
9.7x
Toll Brothers Inc.
NYSE:TOL
29.86
38.15
23.75
4,897
8,428
4,751
589
12.4%
28.1%
1.8x
14.3x
CalAtlantic Group, Inc.
NYSE:CAA
33.44
43.24
26.97
3,959
7,593
6,193
810
13.1%
52.3%
1.2x
9.4x
NVR, Inc.
NYSE:NVR
1,639.87
1,845.37
1,462.02
6,389
6,632
5,635
682
12.1%
12.8%
1.2x
9.7x
KB Home
NYSE:KBH
16.12
16.76
9.04
1,358
3,698
3,388
201
5.9%
18.1%
1.1x
18.4x
Meritage Homes Corporation
NYSE:MTH
34.70
41.33
25.48
1,389
2,374
2,942
247
8.4%
21.3%
0.8x
9.6x
MDC Holdings Inc.
NYSE:MDC
25.80
28.93
19.28
1,265
2,027
2,042
125
6.1%
10.8%
1.0x
16.2x
M/I Homes, Inc.
NYSE:MHO
23.57
25.48
15.56
581
1,209
1,637
118
7.2%
19.8%
0.7x
10.2x
11.9%
20.6%
1.2x
10.2x
Median
Installation Services TopBuild Corp.
NYSE:BLD
$33.20
$38.94
$23.02
$1,276
$1,363
$1,700
$133
7.8%
0.0%
0.8x
10.3x
Installed Building Products, Inc.
NYSE:IBP
35.87
38.97
17.60
1,129
1,279
777
88
11.3%
28.2%
1.6x
14.6x
Comfort Systems USA Inc.
NYSE:FIX
29.31
35.00
24.22
1,088
1,089
1,626
125
7.7%
6.6%
0.7x
8.7x
7.8%
6.6%
0.8x
10.3x
Median Subsector Median
Footnotes: (1) LTM refers to the most recent twelve-month period for which data was available (2) Total enterprise value equals equity value plus minority interest, preferred stock and net debt; net debt equals total debt less cash and cash equivalents
Strictly Confidential | BlackArch Partners | 7
9.7x
Building Products & Infrastructure Industry Update | Q3 2016
Precedent Transaction Analysis Announced Date
Target
Acquiror
Target Description
Building Products American Bath Group, LLC designs and manufactures bathtubs and showers.
Sep-16
American Bath Group, LLC
Lone Star Funds
Sep-16
The Delaney Co.
HCI Equity Partners
Sep-16
European Panel Company S.A. (EPCO)
The Riverside Company
Sep-16
SES Foam, LLC
Tenex Capital Management
Sep-16
Tesla Digital, Inc.
CEN Biotech, Inc.
Sep-16
United Copper Industries, Inc.
Southwire Company, LLC
Sep-16
US Impact Systems, Inc.
CGI Windows & Doors, Inc.
Sep-16
Westfield Lighting Co. Inc.
Ferguson Enterprises, Inc.
Aug-16
Breezeway
JELD-WEN, Inc.
Aug-16
Dectron Internationale Inc.
Specified Air Solutions LLC
Aug-16
Door Engineering and Manufacturing, LLC
Senneca Holdings
Aug-16
Fleuron Enterprises, Inc.
Rowley Company, LLC
Fleuron Enterprises, Inc. manufactures and sells drapery hardware products.
Aug-16
Krestmark Industries, L.P.
Headwaters Incorporated
Krestmark Industries, L.P. manufactures vinyl windows.
Aug-16
Riobel Inc and ROHL LLC
Fortune Brands Home & Security, Inc.
Riobel Inc and ROHL LLC manufacture and market bath fittings.
Aug-16
Ruffin Building Systems, Inc.
Mueller, Inc.
Aug-16
Sina Pearson Textiles, Inc.
Momentum Textiles, LLC
Aug-16
Solarfective Products Limited
Legrand North America, Inc.
Jul-16
American Builders & Contractors Supply Co., Inc., Everlast Polymeric Cladding System
Chelsea Building Products, Inc.
Jul-16
E. O. Wood Company Inc.
Distribution International, Inc.
Jul-16
ESSMANN-Gruppe
Kingspan Group plc
Jul-16
Excalibur Extrusions, Inc., Plastic Pipe Division
VIP Rubber Company, Inc.
Strictly Confidential | BlackArch Partners | 8
The Delaney Co. manufactures residential and commercial door locks, builder's hardware, bath accessories and door hinges. EPCO manufactures sandwich panels for residential, commercial and industrial overhead doors. SES Foam, LLC manufactures spray foam insulations for homeowners, design professionals and contractors. Tesla Digital, Inc. designs, develops, tests and manufactures cold light LED technology. United Copper Industries, Inc. manufactures and distributes copper building wires and cables used in building construction. US Impact Systems, Inc. manufactures fabricated storefront window and door products. Westfield Lighting sells and distributes lighting accessories and furniture items. Breezway manufactures residential and commercial louvre window systems. Dectron Internationale Inc. manufactures engineered indoor air quality (IAQ) and HVAC products and services. Door Engineering designs and manufactures customized industrial, commercial, aviation and specialty doors.
Ruffin Building Systems, Inc. manufactures and supplies preengineered metal building systems and components. Sina Pearson Textiles, Inc. designs, manufactures and distributes upholstery textiles. Solarfective Products Limited manufactures roller shades, skylights and projection screens. Everlast Polymeric Cladding System comprises the brand and distribution rights related to a PVC composite siding. E. O. Wood Company Inc. manufactures and markets commercial, mechanical and industrial insulation products. ESSMANN-Gruppe manufactures industrial skylights and ventilation, smoke extraction and water drainage systems. Excalibur Extrusions, Inc., Plastic Pipe Division manufactures plastic pipes.
Building Products & Infrastructure Industry Update | Q3 2016
Precedent Transaction Analysis Announced Date
Target
Acquiror
Target Description
Spell Capital Partners LLC; Salt Creek Capital II,
Griplock Systems designs and provides cable suspension hardware
LLC; Ocean Avenue Capital Partners, L.P.
and low-voltage products for LED systems.
Jul-16
Griplock Systems, Inc.
Jul-16
Infinity Woven Products
Twitchell Corporation
Jul-16
Nortek Inc.
Melrose Industries PLC
Jul-16
O&S Doors Ltd
Sun European Partners, LLP
Jul-16
Reilly Windows & Doors
Pella Corporation
Jul-16
Thermo Automation Canada Ltd
Convergint Technologies LLC
Infinity Woven Products manufactures and distributes floor and wall coverings. Nortek, Inc. manufactures cooling and heating systems for residential and commercial applications. O&S Doors Ltd. designs and manufactures doors for residential use. Reilly Windows & Doors makes and installs windows, doors, screens and shutters for residential and commercial projects. Thermo Automation Canada Ltd develops and supplies systems that integrate heating, cooling, security and lighting.
Building Materials Sep-16
Cemex Construction Materials Atlantic, LLC, Fairborn Cement Plant and Related Assets
Eagle Materials Inc.
The Fairborn Cement Plant and Related Assets comprise a grinding plant and distribution terminal.
Sep-16
Polycor Inc.
TorQuest Partners
Sep-16
Swenson Granite Company LLC
Polycor Inc.
Aug-16
Absolute Coatings Inc
Valentus Specialty Chemicals, Inc.
Absolute Coatings Inc manufactures wood floor finishes.
Aug-16
C & A Paving Co., Inc.
Clements Concrete Co
C & A Paving Co., Inc. manufactures asphalt and paving products.
Aug-16
Continental Timber Company, Inc.
Conner Industries, Inc.
Continental Timber Company supplies SYP/SPF wood products in the Midwest United States.
Aug-16
Hardin Industries, Inc.
Millstone Capital Advisors, LLC
Hardin Industries, Inc. designs and manufactures custom generator set enclosures.
Aug-16
HeidelbergCement, U.S. Plants
Argos USA Corporation
The HeidelbergCement U.S. Plants include a cement plant and eight related terminals.
Aug-16
Jenna Concrete Corporation
U.S. Concrete, Inc.
Jenna Concrete Corporation produces ready-mix concrete.
Aug-16
Kings Ready Mix Inc.
U.S. Concrete, Inc.
Kings Ready Mix Inc. manufactures ready-mixed concrete.
Aug-16
Sensus Worldwide Limited
Xylem Inc.
Aug-16
Total Forest Industries Ltd.
CanWel Building Materials Group Ltd.
Jul-16
Granite City Tool Company, Inc.
GranQuartz, L.P.
Jul-16
Ovivo Inc.
SKion Water International GmbH
Jul-16
Utility Partners, LLC
H2O Innovation USA Holding Inc.
Strictly Confidential | BlackArch Partners | 9
Polycor Inc. produces natural stone products. Swenson Granite Company LLC engages in quarrying and cutting granite.
Sensus Worldwide Limited is a provider of smart meters, network technologies and data analytics services for the utilities industry. Total Forest Industries Ltd. manufactures and supplies pressure treated wood to independent lumber dealers. Granite City Tool Company, Inc. manufactures and distributes stone tools for the stone industry. Ovivo Inc. provides water and wastewater treatment equipment, technology and systems. Utility Partners, LLC maintains sewer pump stations transporting waste water to local treatment plants for processing.
Building Products & Infrastructure Industry Update | Q3 2016
Precedent Transaction Analysis Announced Date
Target
Acquiror
Target Description
Distribution & Retail All Glass & Windows is a provider of impact-resistant glass and
Sep-16
All Glass & Windows Holdings, Inc.
Prospect Partners, LLC
Sep-16
Fortiline LLC
MORSCO Inc.
Sep-16
Howco Distributing Co. Inc.
Drone USA, Inc.
Sep-16
Olympia Building Supplies, LLC
GMS Inc.
Aug-16
Dawson's, Inc.
W.E. Aubuchon Co., Inc.
Aug-16
Image Design Solutions, LLC
United Subcontractors, Inc.
Aug-16
Keene Lumber Company, Inc.
Standard Companies, Inc.
Aug-16
L&W Supply Corporation
American Builders & Contractors Supply Co., Inc.
L&W Supply Corporation distributes gypsum wallboards and building materials.
Aug-16
Monroe Aluminum Products, Inc.
SRS Distribution, Inc.
Monroe Aluminum Products, Inc. supplies exterior building products.
Aug-16
Nagle Lumber Company
Alexander Lumber Co.
Nagle Lumber Company supplies lumber products.
Aug-16
National Roofing Supplies Inc.
SRS Distribution, Inc.
Aug-16
Small's Hardware Inc.
Acme Lock Inc.
Aug-16
Steven Kempf Building Material Company
GMS Inc.
Steven Kempf Building Material Company distributes building materials to professional building contractors.
Jul-16
Alltemp Products Co. Ltd.
DiversiTech Corporation
Alltemp Products Co. Ltd. distributes HVAC parts.
Jul-16
RockWise, LLC
GMS Inc.
RockWise, LLC distributes building materials to customers in Arizona.
Jul-16
Superior Plus, Construction Products Distribution Business
Strictly Confidential | BlackArch Partners | 10
Foundation Building Materials, LLC
glass-related products for general contractors and builders. Fortiline LLC distributes underground water, sewer and storm utility products. Howco Distributing Co. Inc. supplies construction, transportation and heavy equipment parts. Olympia Building Supplies, LLC distributes a variety of drywall, insulation and other building products. Dawson's, Inc. owns and operates hardware stores. Image Design Solutions, LLC, owns and operates building supplies stores. Keene Lumber Company, Inc. distributes building materials for residential and commercial markets.
National Roofing Supplies, Inc. distributes residential and commercial roofing products and other building materials. Small's Hardware Inc. operates hardware stores in Cheviot, Harrison, Lockland, and Cincinnati, Ohio.
Superior Plus's Construction Products Distribution business distributes specialty construction products.
Building Products & Infrastructure Industry Update | Q3 2016
Precedent Transaction Analysis Announced Date
Target
Acquiror
Target Description
Engineering & Construction Services Sep-16
All Glass Co., Inc.
Private Buyer
All Glass Co., Inc. provides glass installation services.
Sep-16
CCI Group Inc.
Signal Hill Equity Partners
CCI Group provides engineering and consultation services.
Sep-16
City Elevator Company
KONE Oyj
Sep-16
Sep-16
Dream Builders, LLC and 4.5% stake in Dream Homes Ltd. Dunk Fire & Security, Inc., Central Arkansas Business
The Virtual Learning Company, Inc.
State Systems, Inc.
Sep-16
Groom Energy Solutions LLC
DK Energy US LLC
Sep-16
Groupe Sirois Gestion Parasitaire Inc.
Maheu & Maheu Inc
Sep-16
Hart's Home Services, Inc.
Performance Air Conditioning Services, Inc.
Sep-16
M.B. Roofing Systems, Inc. (nka:Tecta America Columbus)
City Elevator Company provides elevator maintenance, modernization and installation services. Dream Builders, LLC and Dream Homes Ltd. construct and renovate residential properties. The Central Arkansas Business of Dunk Fire & Security, Inc. provides fire sprinkler and alarm system installation services. Groom Energy Solutions LLC provides commercial and industrial energy solutions in the United States. Groupe Sirois Gestion Parasitaire Inc. provides extermination and pest management services. Hart's Home Services, Inc. provides electrical and air conditioning services to homeowners.
Tecta America Corp.
Tecta America Columbus provides roofing services.
Naismith Engineering, Inc. operates as an engineering firm.
Sep-16
Naismith Engineering, Inc.
Hanson Professional Services Inc.
Sep-16
Raasch Associates Inc
I & S Group, Inc.
Sep-16
Refrigeration Solutions, Inc.
Source Refrigeration & HVAC, Inc.
Sep-16
Seven Sisters, Incorporated
JH Kelly, LLC
Sep-16
Steven Feller P.E., PL
Yenni Capital, Inc.; Braga Investment & Advisory
Sep-16
Verengo Inc.
Angeleno Group, LLC; CPF Asset Management; Crius Energy Corporation; ClearSky Funding I LLC
Verengo Inc. installs solar photovoltaic systems.
Sep-16
Vulkan Retail Co., S.A. de C.V.
Array Marketing Group, Inc.
Vulkan Retail Co., S.A. de C.V. develops and produces retail space solutions for various brands.
Sep-16
WCI Communities Inc.
Lennar Corporation
Sep-16
Westlake Reed Leskosky (nka:DLR Group|Westlake Reed Leskosky)
DLR Group KKE
Westlake Reed Leskosky provides architectural services.
Sep-16
Wilson Parker Homes Inc.
DR Horton Inc.
Wilson Parker Homes Inc. operates as a home building company.
Sep-16
WSA Systems-Boca, Inc.
Sciens Building Solutions, LLC
Sep-16
XP Solutions Inc.
EQT Partners AB
Strictly Confidential | BlackArch Partners | 11
Raasch Associates Inc. provides architectural and engineering design services. Refrigeration Solutions, Inc. provides commercial and industrial refrigeration and related services. Seven Sisters, Incorporated provides electrical contracting services. Steven Feller P.E., PL provides HVAC, electrical, plumbing, fire and life safety systems and peer review services.
WCI Communities, Inc. operates as a community developer and luxury homebuilder.
WSA Systems-Boca, Inc. provides security and fire systems integration services. XP Solutions Inc. provides drainage and flood hazard software for the civil engineering and environmental sectors.
Building Products & Infrastructure Industry Update | Q3 2016
Precedent Transaction Analysis Announced Date
Target
Acquiror
Target Description
Aug-16
Archadeck Outdoor Living
Private Buyer
Archadeck Outdoor Living provides deck and porch contracting services.
Aug-16
Blackbird Design Studio, LLC
Helix Architecture & Design, Inc.
Blackbird Design Studio, LLC provides architectural design services.
Aug-16
DBi Services, LLC
Sterling Partners
Aug-16
Edwards & Zuck, D.P.C.
Stantec Inc.
Edwards & Zuck, D.P.C. operates as a mechanical, electrical, and plumbing consulting engineering company.
Aug-16
FireClass, L.L.C.
Installed Building Products, Inc.
FireClass, L.L.C. distributes, installs and services fireplaces.
Aug-16
HTS New England
Stebbins-Duffy, Inc.
Aug-16
Jansen Strawn Consulting Engineers, Inc.
Ware Malcomb, Inc.
Jansen Strawn Consulting Engineers, Inc. provides engineering services to the real estate development industry.
Aug-16
Johnson Concrete
Broughton Construction LLC
Johnson Concrete provides concrete construction services.
Aug-16
Major Contractors, Inc.
Private Buyer
Major Contractors, Inc. operates as an electrical site service contractor.
Aug-16
Maxim Construction Group, Corp.
The Falcon Group
Maxim Construction Group, Corp. provides general contracting services.
Aug-16
Mazzetti Inc.
GBA Inc.
Aug-16
Nexxus Solutions Group, LLC
Worley Catastrophe Response, L.L.C.
Aug-16
Outdoor Lighting Perspectives of Northern NJ, LLC
Private Buyer
Aug-16
Process Power & Control, Inc.
Loenbro, Inc.
Aug-16
ROC Geotechnical Consulting Engineers, PLLC
Terracon Consultants, Inc.
Aug-16
San-Con Industries, Inc.
Marietta Silos LLC
DBi Services, LLC provides infrastructure maintenance, operations and management solutions.
HTS New England provides custom HVAC solutions for the commercial, institutional and industrial sectors.
Mazzetti Inc. provides MEPT engineering, equipment planning, sustainability and commissioning services. Nexxus Solutions Group, LLC provides emergency repairs, construction and remodeling services for homeowners. Outdoor Lighting Perspectives of Northern NJ, LLC provides outdoor landscape and architectural lighting services. Process Power & Control, Inc. operates as an electrical contractor specializing in industrial electrical services. ROC Geotechnical Consulting Engineers, PLLC provides geotechnical engineering consulting services. San-Con Industries, Inc. specializes in the construction of silos and stacking tubes for the storage of bulk materials.
The Terminix International Company
Sandwich Isle Pest Solutions, Inc. provides pest control services for
Limited Partnership
residential and commercial clients.
Aug-16
Sandwich Isle Pest Solutions, Inc.
Aug-16
Southern Foam & Coating, Inc.
United Subcontractors, Inc.
Southern Foam and Coating, Inc. operates as a full line insulation contractor.
Aug-16
Southern Insulators & Specialties, LLC
Installed Building Products, Inc.
Southern Insulators & Specialties, LLC provides installation services related to fiberglass and spray foam insulation.
Aug-16
SofTech, Inc., PLM Product Line
Essig Research, Inc.
Aug-16
Tecta America Corp.
ONCAP; Oncap III, L.P.
Tecta America Corp. operates as a commercial roofing contractor.
Aug-16
Valley Insulation, Inc.
TopBuild Corp.
Valley Insulation, Inc. provides insulation services to homes and businesses.
Strictly Confidential | BlackArch Partners | 12
SofTech, Inc., PLM Product Line provides product lifecycle management (PLM) solutions.
Building Products & Infrastructure Industry Update | Q3 2016
Precedent Transaction Analysis Announced Date
Target
Acquiror
Target Description Wally's Refrigeration, LLC provides commercial refrigeration and ice machine services.
Aug-16
Wally's Refrigeration, LLC
Integrated Facility Services, Inc.
Aug-16
W. J. Maloney Plumbing Co., Inc.
Hayes Mechanical, Inc.
Aug-16
Yes Communities, Inc.
GIC Pte. Ltd.
Jul-16
5 Star Security, Inc.
Select Security, Inc.
Jul-16
All-Green Turf Management, Corp.
Rahn Contracting LLC
Jul-16
Applied Polymerics, Inc.
Universal Sealants (UK) Limited
Jul-16
Athalye Consulting Engineering Services, Inc.
TranSystems Corporation
Jul-16
Bebco Industries Inc.
Parkline, Inc.
Jul-16
BGL Corporation
Environmental Compliance Services, Inc.
Jul-16
CJ Roofing Co
Elite Roofing LLC
Jul-16
Coym, Rehmet, and Gutierrez Engineering, L.P.
LJA Engineering, Inc.
Jul-16
De Angelis Construction Inc.
STC Construction Group Inc.
De Angelis Construction Inc. operates as a full-service contractor.
Jul-16
Evergreen Basement Systems, Inc.
JES Construction, Inc.
Evergreen Basement Systems, Inc. operates as a basement waterproofing and foundation repair contractor in Virginia.
Jul-16
Forum Design, Inc.
Ankrom Moisan Architects, Inc.
Jul-16
Foster and Associates Inc.
Arc Surveying & Mapping, Inc.
Jul-16
Hankins & Anderson, Inc.
Mason & Hanger Corporation
Jul-16
Mohlin & Company
CES, Inc.
Mohlin & Company operates as a consulting engineering company.
Jul-16
Royal Flush Plumbing, Inc.
Greenstar Home Services Inc.
Royal Flush Plumbing, Inc. provides plumbing services.
Jul-16
SECCO, Inc., Commercial Mechanical Division
Enginuity LLC
The Commercial Mechanical Division of SECCO, Inc. provides commercial heating, air conditioning and refrigeration services.
Jul-16
Tri-State Engineering, Inc. (nka:Tri-State Engineering, a division of Olsson Associates)
Olsson Associates, Inc.
W. J. Maloney Plumbing Co., Inc. provides plumbing services for commercial and residential clients. Yes Communities, Inc. develops, sells, operates and leases manufactured home communities. 5 Star Security, Inc. installs and maintains surveillance cameras and burglar and fire alarms for residential purposes. All-Green Turf Management, Corp. provides commercial landscape services. Applied Polymerics, Inc. provides contracting services to local Department of Transportation and municipalities. Athalye Consulting Engineering Services, Inc. provides construction support services. Bebco Industries Inc. designs, manufactures and markets portable modular buildings for use in industrial environments. BGL Corporation provides remedial construction, petroleum system construction and storage tank construction services. CJ Roofing Co provides roofing contracting services. Coym, Rehmet, and Gutierrez Engineering, L.P. provides engineering and surveying services.
Forum Design, Inc. provides interior designing and architecture services. Foster and Associates Inc. provides surveying and engineering services. Hankins & Anderson, Inc. designs mission critical facilities for the federal government.
Tri-State Engineering provides engineering services for roadways, bridges and water supply.
Jul-16
TrueNet Communications, Inc.
Fujitsu Network Communications Inc.
TrueNet Communications, Inc. operates as an infrastructure, engineering and specialty contracting company.
Jul-16
Vantem Modular, LLC
AAR Manufacturing, Inc.
Vantem Modular, LLC designs and manufactures foldable, portable and prefabricated building structures.
Strictly Confidential | BlackArch Partners | 13
INDUSTRY INDICATORS TOTAL HOUSING STARTS
BUILDING PERMITS
(Annual Starts in Thousands)
(Number of Housing Units in Thousands) 250
US Population 179.3 (millions)
203.2
226.5
226.5
248.7
281.4
318.4
2,500 2,500
200 Average Housing Starts (1960–2015): 1,442
2,000 2,000
150
1,500 1,500 100
1,000 1,000 50
500 500
Source: U.S. Department of Commerce
Source: U.S. Department of Commerce
TOTAL HOME SALES (Seasonally Adjusted Annual Home Sales in Thousands) 6,500
NEW HOME INVENTORY (Houses for Sale) 600
(Months of Supply) 14
12
500
6,000
10
400
5,500
8
300
5,000
6
200
4,500 4,000
Existing Homes Sold
New Homes Sold
Source: U.S. Department of Commerce, National Association of Realtors
STRICTLY CONFIDENTIAL
2016
2015
2014
2013
2012
2011
2010
2009
2008
1960 1965 1965 1970 1970 1975 1975 1980 1980 1985 1960 1985 1990 1990 1995 1995 2000 2000 2005 2005 2010 2010 2015 2015
2007
2006
0
00
4
100
2
0
0
Houses for Sale at EOM
Months of Supply
Source: U.S. Department of Commerce
| 14
INDUSTRY INDICATORS (CONT.) CONSTRUCTION SPENDING BY TYPE
THE LIRA REMODELING ACTIVITY INDICATOR
($ in Billions)
(As of October 2016; $ in Billions)
$800
$350
$700
$300
$600
$250
$500
$200
10%
$400
$150
5%
$300
$100
$200
$50
(10%)
$100
$0
(15%)
Residential
Nonresidential Buildings
Source: U.S. Department of Commerce
($ in Billions) $463
$500 $400
$500
$390
$450
$432
$300
$200
20% 15%
0% (5%)
Four-Quarter Moving Rate of Change
Source: Joint Center for Housing Studies
NON-RESIDENTIAL BUILDING CONSTRUCTION (2006-2020P) $600
25%
Four-Quarter Moving Total in Billions
Nonresidential, Nonbuilding
30%
$348 $337 $355 $360
$389
$477
$504
$567 $527 $549
NON-RESIDENTIAL BUILDING CONSTRUCTION BY TYPE ($ in Billions) $140 $120 $100 $80 $60 $40 $20 $0
$100 $0
Source: FMI’s Construction Outlook
STRICTLY CONFIDENTIAL
Communication
Lodging
Office
Commercial
Healthcare
Transportation
Manufacturing
Amusement & Rec.
Source: U.S. Department of Commerce
| 15