SCOTTSDALE, Ariz. - Carlisle Companies Incorporated (NYSE:CSL (OTC:CSLLY)), a leader in innovative building envelope products, announced its definitive agreement to purchase the expanded polystyrene (EPS) insulation business of PFB Holdco, Inc., including the Plasti-Fab and Insulspan brands, for $259.5 million in cash. The acquisition, expected to close in the fourth quarter of 2024, aligns with Carlisle's Vision 2030 strategy, which focuses on acquiring superior building envelope products.
Plasti-Fab, a key player in the EPS market in Canada and the Midwestern United States, operates from eight manufacturing locations in Canada and three in the U.S. The company reported revenue of $109 million for the twelve months ending August 31, 2024. Carlisle anticipates that the integration of Plasti-Fab will generate annual cost synergies of $14 million within three years and add approximately $0.30 to adjusted earnings per share in 2025.
Chris Koch, Chair, President, and CEO of Carlisle, stated that the acquisition will enhance their EPS business Insulfoam by providing vertically integrated polystyrene capabilities, supporting retail channel growth, and filling geographic gaps in the U.S. and Canada. He expressed confidence in creating significant value for stakeholders by applying the Carlisle Operating System to the Plasti-Fab business.
The transaction is subject to customary closing conditions, including regulatory approvals. Carlisle's forward-looking statements in the press release indicate their beliefs and expectations but acknowledge that actual results could vary due to factors beyond their control.
The acquisition establishes Carlisle as an industry leader in the North American EPS insulation market, valued at $1.5 billion. The move is part of Carlisle's broader commitment to innovation, increased investment in building products, and emphasis on synergistic mergers and acquisitions.
This news is based on a press release statement from Carlisle Companies Incorporated.
In other recent news, Carlisle Companies Incorporated has been the subject of several notable developments. The company's Q2 2024 results were robust, with an 11% sales growth reaching $1.5 billion, and an adjusted earnings per share increase of 33% to $6.24. Following this performance, Carlisle raised its full-year 2024 outlook, expecting around 12% revenue growth.
On the analyst front, Baird has maintained its Outperform rating for Carlisle and raised the stock's price target to $506. Similarly, Oppenheimer has increased its price target from $475 to $480, reinforcing confidence in potential earnings and cash flow growth for 2024-25.
In other developments, the Australia-based biopharmaceutical company CSL secured a $121.4 million contract from the U.S. Department of Health and Human Services to expand the United States' stockpile of bird flu vaccines. This is the fifth such award CSL has received in response to bird flu outbreaks.
Carlisle also recently completed the $2 billion sale of CIT, transitioning to a pure-play building products company. The company acquired MTL and plans a $45 million investment in a research and innovation center. These developments are part of Carlisle's Vision 2030 strategy, which aims for above-market growth, price and cost leadership, and customer service excellence.
InvestingPro Insights
Carlisle Companies' acquisition of PFB Holdco's EPS insulation business aligns well with its strong financial performance and growth strategy. According to InvestingPro data, Carlisle boasts a market capitalization of $21.33 billion and has demonstrated impressive revenue growth, with quarterly revenue increasing by 10.99% in Q2 2024.
The company's financial health is further underscored by its robust profitability metrics. Carlisle's operating income margin stands at a healthy 23.22% for the last twelve months, indicating efficient operations and strong cost management. This efficiency bodes well for the integration of the newly acquired EPS business and the realization of projected cost synergies.
InvestingPro Tips highlight Carlisle's commitment to shareholder value. The company has maintained dividend payments for 54 consecutive years and has been aggressively buying back shares. These actions, coupled with the recent acquisition, reflect management's confidence in the company's future prospects and its dedication to rewarding investors.
Moreover, Carlisle's stock has shown remarkable performance, with a one-year price total return of 76.44%. This strong market performance, combined with the company's strategic acquisitions and solid financials, suggests that Carlisle is well-positioned to capitalize on growth opportunities in the building products sector.
For investors seeking more comprehensive analysis, InvestingPro offers 16 additional tips for Carlisle Companies, providing deeper insights into the company's financial health and market position.
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