PITTSBURGH - Koppers Holdings Inc . (NYSE: NYSE:KOP), a global provider of treated wood products and related materials, has entered into an agreement to purchase all assets of Brown Wood Preserving Company, Inc. and its affiliates for about $100 million in cash.
The acquisition by Koppers Utility and Industrial Products Inc., a Koppers Holdings subsidiary, is anticipated to close in the second quarter of 2024, pending customary closing conditions.
Brown Wood, established in 1929 with headquarters in Louisville, Kentucky, specializes in manufacturing and selling pressure-treated wood utility poles, employing roughly 100 people. The company predominantly serves the Midwest and Southeast regions of the U.S. from its facilities in Kennedy, Alabama, and Mathiston, Mississippi.
James Sullivan, President and COO of Koppers, expressed enthusiasm about integrating Brown Wood into the Koppers team, highlighting the enhanced capabilities and expanded geographic reach the acquisition will bring. CEO Leroy Ball (NYSE:BALL) views the acquisition as a strategic move in line with the company's intentions to grow their utility pole treatment business.
The transaction is structured as a cash purchase, with Koppers planning to finance the acquisition through available cash and borrowing capacity. Upon completion, Brown Wood will operate within Koppers Utility and Industrial Products division.
While the acquisition is not expected to significantly impact Koppers' financial results for 2024 due to the timing and costs associated with integration, the company anticipates that it will contribute to achieving a projected adjusted EBITDA of between $315 million and $325 million in 2025.
Koppers, headquartered in Pittsburgh, Pennsylvania, operates globally with a diverse range of end markets, including railroad, specialty chemical, utility, and construction industries. Its stock is publicly traded on the New York Stock Exchange.
This news is based on a press release statement and the financial details mentioned are non-GAAP measures, which are used by Koppers management for internal performance assessment and may differ from GAAP measures. The company does not provide reconciliations of these non-GAAP measures to GAAP due to certain items that are difficult to forecast and may be significant.
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