Boral took time to seal US bricks joint venture with Fonterra

Boral’s bricks joint venture in the US with an entity previously owned by private equity firm Lone Star has been a long time coming, with the country’s largest building materials provider said to have been working on it for almost a year.

Interestingly, it has emerged that Boral called on the services of Macquarie Capital, with which it has had a longstanding relationship, and Citi. It may put to rest rumours about what private equity deal Macquarie’s industrials team was working on, given those close to Boral at the bank are Melbourne-based.

Boral’s announcement on the deal yesterday revealed how it plans to fold its US bricks business into a new joint venture with an affiliate of private equity firm Forterra as it reported a flat net profit of $256 million.

Forterra was sold by Lone Star this year through an initial public offering after the equity firm swallowed assets divested as part of the global LaFarge-Holcim merger.

The newly merged building materials giant had plans to float its Australian operations on the Australian Securities Exchange this year but the deal was shelved after the group sold assets in Asia to help drive down its debt load on the back of the $53 billion merger.