Last month Knauf completed the acquisition of USG in North America. The company said that the purchase would create a global building materials industry leader that will be even better positioned to meet customers’ needs by leveraging two highly complementary businesses, product portfolios and global footprints.
Knauf agreed to buy USG in mid-2018 for US$7bn. The transaction is the largest acquisition in Knauf’s history and with USG’s strong brands it provides leading market positions in the North American wallboard and ceilings sectors.
There will be some readjustment of assets, such as the disposal of its interest in USG-Boral in south east Asia. But it is in North America that there is a step change. Bringing USG into the Knauf family means the Group now controls 1,155Mm2/annum across Canada, Mexico and USA, more than a quarter of North America’s plasterboard capacity.
On the world stage Knauf’s USG acquisition concentrates plasterboard production even more in the hands of three European construction product giants; Knauf, Saint- Gobain and ETEX. Between them, they control 95% of plasterboard capacity in the European Union.
And it is not just plasterboard where Knauf’s position has been changing. Last year Knauf acquired Armstrong World Industries’ ceilings business outside the Americas. In December 2018 the European Commission gave the go ahead provided it addressed competition concerns and disposed of Armstrong’s ceiling tile plants in Britain.
Once Knauf has bedded in Armstrong’s ceilings business in Europe and the USG activities in North America, where will it turn its sights next?