Saint-Gobain Boosts Construction Chemicals with GCP Buy
French multinational group Saint-Gobain has agreed to acquire GCP Applied Technologies for about $2.3 billion, gaining a world-leading presence in the expanding construction chemicals sector. Both boards of directors have unanimously approved the deal, which is expected to close by the end of 2022.
GDP Applied Technologies has annual revenues of roughly $1 billion, operates 50 manufacturing plants in 38 countries and employs about 1,800 people. Simon Bates, the company’ president and CEO, commented: “Thanks to its global platform, significant resources as well as commercial and innovation expertise, Saint-Gobain is perfectly positioned to ensure the success of GCP’s operations and people over the long term.”
The proposed acquisition comes hot on the heels of Saint-Gobain’s purchase of Chryso – another leading construction chemicals player, from private equity group Cinven. That deal closed on Sep. 29. Saint-Gobain said that after the successful acquisition of Chryso, which provides additives that reduce concrete’s carbon footprint, GCP is the logical next step in providing solutions to decarbonize the construction industry.
GCP’s concrete admixtures and cement additives businesses will be combined with the Chryso business and form part of the High Performance Solutions segment. The combined companies are present in all main geographies and benefit from two highly complementary footprints. Chryso holds strong positions mostly in Europe, the Middle East and Africa, while GCP has a significant presence in North America, Latin America and Asia-Pacific. GCP’s specialty building materials business in North America, with annual sales of about $250 million, will be integrated into Saint-Gobain’s CertainTeed business.
The merger is expected to yield synergies of approximately $85 million by year five, including cost synergies of about $72 million, which are expected to be captured through eliminating GCP’s public company costs, pruning of selling, general and administrative expense, economies of scale in procurement and optimizing manufacturing and logistics costs.
Author: Elaine Burridge, Freelance Journalist
