Parts of Boral attracting plenty of attention

Boral Bricks makes Summerset pavers.

One of the most widely discussed stocks within dealmaking circles right now is Boral and, while its $US5bn-plus US business is getting plenty of attention from private equity, it is only a strategic buyer that is expected to offer a price for the division that would be acceptable to the company’s board. The general consensus is that fly ash is attractive but not the other parts of the US operations, including the windows business that is not the No 1 player in the market.

There were suggestions that activist investor and former star investment banker John Wylie was angling for a break-up of Boral in September, as reported by this column at the time, where a buyer would walk away with segments of the operation. Boral, the country’s largest building materials provider, has frustrated shareholders over many years and its share price has been on a downward spiral as its results continue to disappoint.

The company’s CEO, Mike Kane, has now left earlier than some expected — also tipped by DataRoom in October — and any break-up was always thought to be only on the cards once he had gone.

It was only in 2016 that Boral made a $3.5bn acquisition of Utah-based building products manufacturer Headwaters, but the US bricks business was out of favour after the global financial crisis more than a decade ago.

So far tyre kickers around Boral are said to have included groups such as Lone Star Funds and CRH. Boral’s overall market value is now $5.57bn.