Kingspan Group Plc said early talks with Carlisle Cos. of the US about a potential deal have ended after news that the Irish company proposed creating a materials giant with a combined market value of almost $30 billion.
(Bloomberg) — Kingspan Group Plc said early talks with Carlisle Cos. of the US about a potential deal have ended after news that the Irish company proposed creating a materials giant with a combined market value of almost $30 billion.
“Kingspan has admired Carlisle for many years and, recognizing the clear strategic fit, had recent and informal discussions on a potential transaction,” the Irish insulation and construction products maker said in a statement Wednesday. “At present, there is no active engagement.”
Separately, JPMorgan Chase & Co. downgraded Kingspan to “neutral” from “overweight.” Catalysts have largely played out for the company, while stocks in the construction sector could be vulnerable for the rest of the year, analysts led by Elodie Rall wrote. Shares of Kingspan fell as much as 3% in early Dublin trading Wednesday.
Bloomberg News reported Sunday that Carlisle had rebuffed an informal approach from Kingspan about a tie-up. Carlisle rejected the pitch but signaled it would be open to at least reviewing a more attractive offer, people with knowledge of the matter had said. The Irish company isn’t currently working on a formal takeover bid, some of the people said at the time.
Carlisle makes roofing and building envelope products, including construction and weather-proofing materials. The Scottsdale, Arizona-based firm announced plans this month to sell its Carlisle Interconnect Technologies unit that provides products to the aerospace and medical technologies markets, which would make it a pure-play construction supplier.
In Wednesday’s statement, Kingspan said the North American roofing space remains a key area of interest.
News of the companies ending talks comes a day after another big Irish-to-US deal was announced. Dublin-based Smurfit Kappa Group Plc said Tuesday it agreed to acquire WestRock Co. of Atlanta in an $11.2 billion deal that creates a packaging industry powerhouse.
–With assistance from Isolde MacDonogh.
(Updates with more Kingspan comments, analyst downgrade from second paragraph)
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