Saint-Gobain announced on May 31, that it has entered into a definitive agreement to acquire Kaycan, a family-owned manufacturer and distributor of exterior building materials in Canada and in the United States, for US$928 million in cash.
With this acquisition, Saint-Gobain reinforces its worldwide leadership in light and sustainable construction by becoming the top siding player in Canada and enlarging its vinyl offer across the U.S. with complementary solutions including notably aluminum and engineered wood.
The price represents a multiple of approximately 11.2 times Kaycan’s estimated 2021 to 2022 earnings (before interest, taxes, depreciation and amortization) of US$83 million and a net acquisition price of approximately US$820 million.
This acquisition meets the Saint-Gobain’s strategic goal to strengthen Saint-Gobain’s leadership in North America as well as enriching the company’s offering in light and sustainable construction, amongst other goals.
Closing of the transaction is subject to antitrust approvals and satisfaction of other customary closing conditions; it is expected to close by year-end 2022.
Kaycan is a leading exterior building materials player with US$472 million in revenues – more than half in Canada and the remainder in the U.S., 12 manufacturing plants (nine in Canada) and around 1,300 employees. It is the leading manufacturer of siding products in Canada which it sells thanks to its well-known and trusted brand via its dedicated distribution and strong channel coverage in big-box retail, providing unparalleled customer reach across the country and with recycling services of post-consumption materials which can in turn be incorporated into the production process. Leveraging the highly efficient country organization of Saint-Gobain, this acquisition will complement the company’s leadership in Canada allowing it to broaden the light and sustainable construction solutions offered for the benefit of its Canadian customers. It will also allow Saint-Gobain to strengthen and expand its channel coverage and partnerships to reach new customers in the light commercial market.
“The acquisition of Kaycan is an excellent step for Saint-Gobain and I am very enthusiastic to warmly welcome the Kaycan teams into the Group. Not only does this acquisition allow us to strengthen our presence in siding both in Canada and in the United States, but it also allows us to broaden our offering into the exciting growth areas of aluminum and engineered wood siding, largely made with recycled materials and thus helping to drive the circular economy ecosystem in construction,” says Benoit Bazin, CEO, Saint-Gobain.
“Today marks the beginning of an exciting new chapter of Kaycan’s history. Ever since my family founded Kaycan in 1974, our team has been laser-focused on providing the best customer service possible throughout Canada and the United States, all while pushing the boundaries of imagination and innovation to expand our product portfolio over the past decades. Now we have the opportunity to join Saint-Gobain, a renowned leader in light and sustainable construction. We are filled with gratitude for our team’s hard work over the past 48 years and we’re thrilled to see what comes next for our combined companies,” says Lionel Dubrofsky, president, Kaycan.
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