Carlisle Companies has entered a definitive agreement to acquire building envelope systems provider Henry Company from affiliates of private equity firm American Securities for $1.575 billion in cash. The purchase price represents 10.5x Henry Company’s adjusted EBITDA for the 12-month period ending May 31, 2021, when including run-rate cost synergies.
Henry Company provides residential and commercial building envelope systems that control the flow of water, vapor, air, and energy in a building. The company serves customers across both new construction and repair and restoration projects. Henry Company generated revenue of $511 million and adjusted EBITDA of $119 million, with an adjusted EBITDA margin of 23%, for the 12-month period ending on May 31.
Carlisle’s acquisition is consistent with its “Vision 2025” to simplify its portfolio and strategically build scale with synergistic acquisitions in order to achieve $15 of earnings per share. According to Carlisle, the acquisition of Henry Company increases its presence in residential construction in North America and strengthens its position in integrated building envelope solutions that reduce installation times and improve energy efficiency.
“The combination will benefit from strong secular tailwinds as demand for energy efficient building solutions continues to increase,” Nick Shears, president of Carlisle’s Construction Materials (CCM) business, said in a news release. “In addition, we share a common focus on innovation, which has been core to both companies’ long term success. We look forward to welcoming Henry’s talented team to Carlisle.”
The acquisition is expected to generate pre-tax cost synergies of $30 million by 2025. Additional revenue synergies from cross-selling a broader product portfolio through Carlisle’s existing relationships and sales channels are expected, according to Carlisle. The acquisition, which is subject to customary closing conditions, is expected to close in the third quarter of 2021.
Carlisle Companies is a supplier of innovative building envelope products and energy-efficient solutions. Headquartered in Scottsdale, Ariz., Carlisle operates more than 180 locations worldwide.
