Foundation Building Materials (FBM) has completed its acquisition by American Securities, a prominent U.S. private equity firm. This transition to private ownership is expected to enhance FBM's ability to better serve customers in the U.S. and Canada. FBM, a leading distributor of specialty building products including wallboard and metal framing, operates over 170 branches and employs 3,300 staff across North America. American Securities plans to partner with FBM's management to support the company's strategic growth initiatives.
Foundation Building Materials (FBM) has entered a definitive agreement for an acquisition by an affiliate of American Securities for $19.25 per share, valuing the transaction at approximately $1.37 billion. This all-cash deal represents a 27% premium over FBM's closing price on November 13, 2020. Following the acquisition, FBM will become a privately held company. The transaction has been unanimously approved by FBM's Board of Directors and is expected to close in Q1 2021, pending customary conditions.
Foundation Building Materials (FBM) reported Q3 2020 results, highlighting a net sales decrease of 7.7% to $521.3 million compared to Q3 2019. The decline was driven by the COVID-19 pandemic's adverse effects on commercial construction. Gross profit fell by 10.1% to $154.4 million, with a gross margin of 29.6%. SG&A expenses decreased by 7.1% to $115.1 million. Despite challenges, net income from continuing operations was $11.8 million, down from $12.7 million a year earlier. The company provided full-year guidance, expecting 2020 net sales between $2.01 and $2.03 billion.
Foundation Building Materials (FBM) will release its Q3 2020 financial results on November 2, 2020, after market close. A conference call is scheduled for November 3, 2020, at 8:30 AM ET where management will discuss the results. The call can be accessed via the FBM website, telephone, or through an audio replay after the event. FBM is a leading distributor of wallboard and complementary products in North America, operating over 170 branches with more than 3,400 employees.