By Colin Kellaher
Beacon Roofing Supply announced Friday that it has agreed to buy back its Series A preferred stock held by private equity firm Clayton Dubilier & Rice for $804.5 million.
The Herndon, Virginia-based building products maker said it plans to fund the buyback with a mix of new and existing debt financing and cash, adding that it expects to close the transaction by Aug. 11.
Beacon said the move would reduce the company’s diluted share count by 9.69 million shares on an equivalent basis, eliminate $24 million in preferred dividends per year and simplify its capital structure.
New York buyout firm CD&R, which made the preferred investment in Beacon in 2018 to support the company’s acquisition of Allied Building Products, will continue to hold nearly 15.2 million shares of Beacon common stock.
Beacon said Philip Knisely, an operating partner of CD&R, will remain on the board but will step down as non-executive chairman and Stuart Randle, currently senior independent director, will take over. CD&R CEO Nathan Sleeper plans to step down from the Beacon board.
Write to Colin Kellaher at colin.kellaher@wsj.com
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https://www.marketwatch.com/story/beacon-roofing-to-buy-back-cd-r-s-preferred-stake-for-more-than-800-million-d3e81e34?mod=investing
