Saint-Gobain has entered into a definitive agreement to acquire FOSROC, a leading privately-owned global construction chemicals player for US$1025m in cash. Following the acquisitions of Chryso in 2021, GCP in 2022 and 33 additional acquisitions since 2021, this move is a new strategic step in establishing Saint-Gobain’s worldwide presence in construction chemicals, which will have combined sales of EUR6.2bn across 73 countries following the acquisition (pro forma).
FOSROC is a global construction chemicals player with a strong geographic footprint in India, the Middle East and Asia-Pacific in particular. The company is expected to generate US$487m of sales and to achieve an estimated EBITDA margin of 18.7 per cent in 2024. With 20 manufacturing plants and around 3000 employees, FOSROC provides a wide range of technical solutions for the construction industry, including admixtures and additives for concrete and cement, adhesives and sealants, waterproofing solutions, concrete repair solutions and flooring.
The purchase price represents an acquisition multiple (before synergies) of approximately 11.3x FOSROC’s 2024E EBITDA of US$91m, and a multiple of approximately 7.1x when including run-rate synergies of approximately US$54m in year three.
This acquisition will be fully financed in cash. According to the group, it will maintain a strong balance sheet with net debt/EBITDA remaining at the low end of the target range (1.5x to 2.0x) including the recently announced Bailey and CSR Ltd acquisitions. Closing of the transaction is subject to customary conditions and is expected in the 1H25.
