Foundation Building Materials Goes Private

Foundation Building Materials Goes Private

American Securities has closed its acquisition of publicly traded Foundation Building Materials (FBM), a distributor of building products, in an all-cash transaction valued at approximately $1.4 billion.

FBM’s products include wallboard, suspended ceiling systems, metal framing, insulation, stucco, fasteners, drywall and power tools, doors and frames.

Dallas-based Lone Star Funds acquired FBM in 2015 and has maintained a majority ownership position since the company’s initial public offering in 2017. In 2020, FMB had revenues of approximately $2.0 billion and adjusted EBITDA of $150 million. At an enterprise valuation of $1.4 billion, this equates to an EBITDA valuation multiple for FBM of 9.3x.

FBM, led by CEO Ruben Mendoza, is headquartered in Santa Ana, California and has more than 170 branches across the United States and Canada with 3,300 employees.

“Under private ownership, FBM will have greater flexibility to intensify its focus on serving customers across the US and Canada,” said Mr. Mendoza.

“We have long admired FBM’s talented team members and its track record of market leadership and growth,” said Kevin Penn, a managing director at American Securities. “We are excited to work alongside management to help the company execute its strategic plan and continue delivering high-quality products and service to its customers.”

American Securities invests in businesses with $200 million to $2 billion of revenue and $50 million to $250 million of EBITDA.  Sectors of interest include industrial manufacturing, specialty chemicals, aerospace and defense, energy, business services, healthcare, media, restaurants, and consumer products. The firm has more than $23 billion of capital under management and has offices in New York City and Shanghai.

© 2021 Private Equity Professional | February 2, 2021

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