Kingspan Group Plc made an informal approach to combine with Carlisle Cos., which rebuffed the move to create a building materials giant with a combined market value of almost $27 billion, people familiar with the matter said.
The Irish insulation and construction products company proposed a deal in recent months, according to the people. Carlisle, which has a market capitlization of $12.5 billion, rejected the pitch but signaled it would be open to at least reviewing a more attractive offer, they said.
Shares in Kingspan were down 0.3% at 8:24 a.m. in Dublin on Monday, giving the company a market value of €13.4 billion ($14.3 billion).
Kingspan isn’t currently working on a formal takeover bid, some of the people said, asking not to be identified because deliberations are private. If Carlisle did explore a sale, it could trigger fresh interest from the Irish company as well as other building materials rivals, they said.
A representative for Kingspan declined to comment, while a spokesperson for Carlisle didn’t immediately provide comment.
Carlisle makes building envelope products and solutions, including construction materials and weather proofing assets. 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.
News of Kingspan’s approach for Carlisle comes just days after another mega Irish-to-US deal was announced. Dublin-based Smurfit Kappa Group Plc and US firm WestRock said last week they are in talks to merge, potentially creating an industry giant with a market value of about $20 billion.
There has been a pick-up in deals in the building materials sector. Cementos Argos, the Colombian concrete maker, announced earlier this month it will merge its US operation with Summit Materials Inc. in a deal valued at $3.2 billion. And Swiss company Georg Fischer AG offered to buy Finnish plumbing-equipment manufacturer Uponor Oyj in June.
European companies are showing increased appetite to do deals in the US to benefit from more stable economy and President Biden-promoted investments in infrastructure, as well as deeper capital markets.
Kingspan in April announced plans to delist from the London Stock Exchange, marking another potential high-profile departure from the flagship UK market. Smurfit and WestRock also said this month they would be listed on the New York Stock Exchange.
In July, Kingspan agreed to buy a majority stake in Steico SE from its founder to add natural insulation and wood-based building envelope products.
--With assistance from Kiel Porter.
(Updates with shares in third paragraph.)
Author: Aaron Kirchfeld, Dinesh Nair and Ruth David
