Beacon Announces Closing of $600 Million Senior Secured Notes Offering and Completes Repurchase of Series A Preferred Stock
01 August 2023 - 6:00AM
Business Wire
Beacon Roofing Supply, Inc. (Nasdaq: BECN) (“Beacon,” the
“Company”, “we,” “us” or “our”) announced today that it has closed
its previously announced private offering (the “Offering”) of $600
million aggregate principal amount of its 6.500% senior secured
notes due 2030 (the “Notes”). The Notes are fully and
unconditionally guaranteed by the Company’s subsidiary, Beacon
Sales Acquisition, Inc.
Immediately following the completion of the Offering on July 31,
2023, Beacon used the net proceeds from the Offering together with
cash on hand and available borrowings under its senior secured
asset-based revolving (ABL) credit facility, to (i) consummate the
previously announced repurchase of all 400,000 outstanding shares
of Series A Cumulative Convertible Participating Preferred Stock
(the “Series A Preferred Stock”) held by an entity affiliated with
the Clayton Dubilier & Rice, LLC (“CD&R”) investment firm
for an aggregate cash amount of $805,433,333.33 and (ii) pay all
related transaction fees and expenses.
The repurchase of the Series A Preferred Stock is expected to
provide substantial benefits to Beacon and its common stockholders,
including:
- reducing diluted share count on an as converted basis by 9.69
million shares;
- providing immediate accretion to earnings per share;
- eliminating preferred dividends of $24.0 million per year;
and
- simplifying Beacon’s capital structure.
As previously announced, Nathan Sleeper, CD&R’s CEO and one
of its representatives on the Company’s board of directors, has
resigned from the Company’s board following the closing of the
repurchase, while Philip Knisely, an Operating Partner of CD&R,
has stepped down as the Company’s non-executive board chair, but
will continue to serve on the Company’s board. The board has
elected Stuart Randle, the Company’s lead independent director, to
succeed Mr. Knisely as the Company’s non-executive board chair,
effective as of August 1, 2023.
The Notes and the related guarantee were offered only to persons
reasonably believed to be qualified institutional buyers under Rule
144A of the Securities Act of 1933, as amended (the “Securities
Act”), and to certain non-U.S. persons in transactions outside the
United States under Regulation S under the Securities Act. The
issuance and sale of the Notes and related guarantee were not, and
will not be, registered under the Securities Act or the securities
laws of any state or other jurisdiction.
Forward-Looking Statements
This release contains information about management's view of the
Company's future expectations, plans and prospects that constitute
forward-looking statements for purposes of the safe harbor
provisions under the Private Securities Litigation Reform Act of
1995. In addition, oral statements made by our directors, officers
and employees to the investor and analyst communities, media
representatives and others, depending upon their nature, may also
constitute forward-looking statements. Forward-looking statements
can be identified by the fact that they do not relate strictly to
historic or current facts and often use words such as “anticipate,”
“estimate,” “expect,” “believe,” “will likely result,” “outlook,”
“project” and other words and expressions of similar meaning.
Investors are cautioned not to place undue reliance on
forward-looking statements. Actual results may differ materially
from those indicated by such forward-looking statements as a result
of various important factors, including, but not limited to, those
set forth in the "Risk Factors" section of the Company's Form 10-K
for the fiscal year ended December 31, 2022 and subsequent filings
with the U.S. Securities and Exchange Commission. The Company may
not succeed in addressing these and other risks. Consequently, all
forward-looking statements in this release are qualified by the
factors, risks and uncertainties contained therein. In addition,
the forward-looking statements included in this press release
represent the Company's views as of the date of this press release
and these views could change. However, while the Company may elect
to update these forward-looking statements at some point, the
Company specifically disclaims any obligation to do so, other than
as required by federal securities laws. These forward-looking
statements should not be relied upon as representing the Company's
views as of any date subsequent to the date of this press
release.
About Beacon
Founded in 1928, Beacon is a Fortune 500, publicly traded
distributor of building products, including roofing materials and
complementary products, such as siding and waterproofing. Beacon
operates over 500 branches throughout all 50 states in the U.S. and
6 provinces in Canada. Beacon serves an extensive base of nearly
100,000 customers, utilizing its vast branch network and diverse
service offerings to provide high-quality products and support
throughout the entire business lifecycle. Beacon offers its own
private label brand, TRI-BUILT®, and has a proprietary digital
account management suite, Beacon PRO+, which allows customers to
manage their businesses online. Beacon’s stock is traded on the
Nasdaq Global Select Market under the ticker symbol BECN.
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INVESTOR CONTACT Binit Sanghvi VP,
Capital Markets and Treasurer Binit.Sanghvi@becn.com
972-369-8005
MEDIA CONTACT Jennifer Lewis VP,
Communications and Corporate Social Responsibility
Jennifer.Lewis@becn.com 571-752-1048
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