Cornerstone Building Brands stock up 15% on Monday: how come?

0

Cornerstone Building Brands Inc (NYSE: CNR) is up nearly 15% on Monday after Clayton, Dubilier & Rice LLC (CD&R) said it will buy the exterior building products company for $5.80 billion.

What it means for Cornerstone Building Brands shareholders?

The cash deal translates to $24.65 per share for Cornerstone stockholders, which represents a 16% premium on where the stock closed the regular session last Friday. The transaction is expected to complete in the second or third quarter of the current year.

CD&R already had a 49% stake in Cornerstone. The private equity company has now agreed to buy the remaining outstanding shares of CNR. The stock trades at a PE multiple of 4.65 at present.

Cornerstone Building Brands stock is up 75% in about a month

Cornerstone’s Board of Directors have already given the green signal for the acquisition. In the press release this morning, CEO Rose Lee said:

This transaction provides substantial value for our shareholders while also accelerating Cornerstone’s aspiration to become a premier exterior building solutions company. CD&R will continue to be an outstanding partner as we advance our operational improvements and innovation-driven growth to create many positive outcomes for our customers and employees.

The news comes a week after Cornerstone Building Brands reported a 24% year-over-year growth in its fiscal fourth-quarter revenue. CNR has climbed up roughly 75% in about a month.

The post Cornerstone Building Brands stock up 15% on Monday: how come? appeared first on Invezz.