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Cornerstone Building (CNR) Divests Roll-up Sheet Door Business

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Cornerstone Building Brands, Inc. (CNR - Free Report) has divested the Roll-up Sheet Door business, DBCI, to Janus International Group, Inc. (JBI - Free Report) , thereby optimizing its portfolio for further growth in large, deep markets. The all-cash transaction is valued at $168 million.

The company expects to spend the net proceeds in strategic initiatives toward profitable growth, operational excellence and attaining net debt leverage target of 2.0-2.5x.

It has been focusing on unlocking values by monetizing strong assets at an attractive multiple and optimizing portfolio for sustainable growth.

Efforts to Drive Growth

In an attempt to fuel high-growth, high-profitability businesses, the company has been divesting assets. In sync with this, it has also completed the Insulated Metal Panels business divestiture to Nucor Insulated Panel Group Inc. in a cash transaction worth $1 billion. Cornerstone Building expects to utilize post-tax transaction proceeds to pay down a portion of its secured credit facilities, invest in organic growth and efficiency projects as well as strategic acquisitions.

Inorganic Drive

The company has been actively involved in acquisitions and divestiture to drive growth. On Apr 30, 2021, it acquired Prime Windows LLC that serves residential new construction and repair and remodel markets with energy efficient vinyl window and door products from two manufacturing facilities in the United States. This buyout has expanded Cornerstone Building manufacturing capabilities in the Western United States.

Owing to the company’s continuous efforts to optimize portfolio, it now expects third-quarter net sales between $1,385 million and $1,435 million, depicting growth from $1,227 million reported a year ago.

Zacks Investment Research
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Shares of this Zacks Rank #1 (Strong Buy) manufacturer of exterior building products have gained 68.1% year to date, outperforming the Zacks Building Products - Concrete and Aggregates industry’s 36.3% rally. The company, which shares space with Eagle Materials Inc. (EXP - Free Report) and Martin Marietta Materials, Inc. (MLM - Free Report) in the same industry, has been benefiting from higher sales growth and strong performance across all business segments backed by strong residential demand and price actions that offset inflationary pressures. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.