USG To Divest L&W Supply For $670 Million

USG Corporation USG and ABC Supply disclosed that they reached a definitive deal through which the former would divest its L&W Supply Corporation to the latter for $670 million cash. The transaction is expected to be completed before the current year ends.

USG's Chairman, President and CEO, James Metcalf, commented, "The sale of L&W Supply is transformative for USG Corporation, enabling us to right-size our balance sheet and accelerate profitable growth. This transaction sharpens our focus on manufacturing and innovation and creates a new strategic relationship with ABC Supply."

The company believes the divestment would enable it to cut down its debt and achieve the targeted level of leverage ratio. USG also believes the move would allow them from accelerating high return investments in gypsum and ceilings business with the advanced manufacturing initiatives. As a result, it would be able to consider capital returns to its shareholders in the future.

The stock closed Friday's regular trading at $28.06 shedding $0.05, or 0.18 percent.