BlueScope Steel Limited has entered into a binding agreement to acquire the Coil Coatings business from Cornerstone Building Brands Inc. for US$500 million, a bourse filing noted.

Coil Coatings is the second largest metal painter in the US, with a total capacity of around 900,000 tons per annum across seven facilities, predominantly serving commercial and industrial construction applications.

BlueScope Managing Director and CEO Mark Vassella said the acquisition of Coil Coatings almost triples BlueScope’s “US metallic coating and painting capacity to over 1.3 million metric tons per annum, from around 475,000 tons per annum at present, and gives us immediate and direct access to the large and growing Eastern US region.”

The purchase price of US$500 million represents approximately 8.9 times CY2021 pro-forma EBITDA of US$56 million, including year three synergies. Following completion, Cornerstone Building Brands will remain a key customer of the business.

The transaction is targeted for completion in calendar year 2022, subject to regulatory approval and other customary closing conditions. RF