James Hardie and AZEK to Combine Creating a Leading Building Products Growth Platform

Combines World-Class Talent with Shared Cultures Focused on Providing Winning Solutions Across the Customer Value Chain

Unites Highly Complementary Offerings of Leading Exterior Brands and Significantly Expands James Hardie's Total Addressable Market

Expected to Accelerate James Hardie's Revenue Growth Trajectory and Generate at Least $350 Million of Additional Annual Adjusted EBITDA from Synergies when Fully Realized

Expected to be Accretive to James Hardie's Cash Earnings Per Share in First Full Fiscal Year After Closing

Combined Company's Compelling Value Proposition, Increased Scale, Significant Runway for Enhanced Financial Growth and Two Major Global Listings Unlocks Potential for Valuation Uplift

Companies to Host Investor Conference Call Today, March 24, 2025 at 9:00am Australian Eastern Daylight Time / March 23, 2025 at 6:00pm U.S. Eastern Time

SYDNEY & CHICAGO--(BUSINESS WIRE)--March 23, 2025-- 

James Hardie Industries plc (ASX / NYSE: JHX) ("James Hardie" or the "Company"), a leader in providing high-performance, low-maintenance building products and solutions, and The AZEK Company Inc. (NYSE: AZEK) ("AZEK"), a leading manufacturer of high-performance, low-maintenance and environmentally sustainable outdoor living products, today announced entry into a definitive agreement (the "Agreement") under which James Hardie will acquire AZEK for a combination of cash and James Hardie shares with a total transaction value of $8.75 billion, including AZEK's net debt of approximately $386 million as of December 31, 2024.

Under the terms of the Agreement, AZEK shareholders will receive $26.45 in cash and 1.0340 ordinary shares of James Hardie to be listed on the New York Stock Exchange $(NYSE)$ for each share of AZEK common stock they own. The stock and cash consideration represents a total per share value of $56.88, based on the closing stock price of AU$46.80 per share of James Hardie's CHESS Depositary Interest $(CDI.NZ)$ listing on the Australian Securities Exchange (ASX) on March 21, 2025, which is a 26% premium to AZEK's volume-weighted average price (VWAP) over the 30 trading days prior to March 21, 2025 and a 21% premium to AZEK's VWAP over the 60 trading days prior to March 21, 2025. Upon completion of the transaction, James Hardie and AZEK shareholders are expected to own approximately 74% and 26%, respectively, of the combined company. Following the closing of the transaction, James Hardie's ordinary shares will be listed on the NYSE and James Hardie is expected to be eligible for broader index inclusion in the U.S. in the future. James Hardie will maintain its current CDI listing and index inclusion on the ASX.

The combination of James Hardie and AZEK will create a leading exterior and outdoor living building products growth platform with efficient scale and profitability supported by leading brands driving material conversion. By bringing together highly complementary products that span siding, exterior trim, decking, railing and pergolas, the combined company will offer a comprehensive and innovative material replacement solution to homeowners, customers and contractors.

"This combination with AZEK is an extraordinary opportunity to accelerate our growth strategy, deliver enhanced and differentiated solutions to our customers and drive shareholder value," said Aaron Erter, James Hardie CEO. "We are uniting two highly complementary companies with large material conversion opportunities and shared cultures centered around providing winning solutions to our customers and contractors. Together, we will be well positioned to drive sustained above market growth as a leader across attractive categories for the exterior of the home. The consumer journeys for siding and decking often overlap and both companies have excelled at demand creation for the homeowner and innovative products and solutions for the contractor. Additionally, given the substantial opportunity to drive synergies and James Hardie and AZEK's shared discipline around operational efficiency, we expect to significantly enhance the combined company's profitability and cash flow. On behalf of the entire James Hardie team, I look forward to welcoming the talented AZEK team to the James Hardie family and together extending our track record of success."

"Over AZEK's more than 40-year history, we have made strategic investments in innovation, capabilities and talent, driving sustained above-market growth with our industry-leading brands, including TimberTech and AZEK Exteriors, and delivering an attractive margin profile with significant opportunities for expansion ahead. Building upon our proven track record of success, today marks an exciting start to the next phase of AZEK's journey to further accelerate growth and material conversion," said AZEK CEO, Jesse Singh. "Together with James Hardie, we are delivering value to AZEK shareholders and providing them meaningful participation in the long-term secular and financial growth opportunities created by the combined company. We are bringing together two customer-centric organizations with a shared commitment to innovation and building a better, more sustainable and resilient future, and we are excited about the opportunities ahead."

Compelling Strategic and Financial Benefits

   -- Creates a leading exterior and outdoor living growth platform: The 
      transaction brings together two high-growth companies with complementary 
      product offerings across major categories on the exterior of the home. 
      James Hardie's and AZEK's brands benefit from efficiencies of scale and 
      innovative products and, when combined, will create a compelling 
      proposition across the customer value chain. The addition of AZEK, which 
      has averaged more than 15% net sales growth in its residential business 
      segment over the last seven years, will materially enhance James Hardie's 
      top-line growth trajectory. As a result of the combination, over the next 
      five years, the annual growth rates of James Hardie's net sales and 
      adjusted EBITDA are expected to accelerate by more than 250 basis points 
      and 300 basis points, respectively. 
 
   -- Accelerates material conversion-led growth: Both companies have a long 
      history of material conversion-led growth; each offering products with 
      compelling aesthetics and durability. The combined company will increase 
      its total addressable market in North America to $23 billion and have a 
      meaningful opportunity to drive accelerated material conversion across 
      its combined product offering. 
 
   -- Provides customers a comprehensive solution of sustainable exterior and 
      outdoor living brands: Together, James Hardie and AZEK provide a 
      full-wrap and complementary solution for the exterior of the home, 
      offering beautiful, resilient, fire, pest and weather resistant products 
      that are easy to install with reduced maintenance and lower lifecycle 
      costs. The combination will allow James Hardie to deliver significant 
      benefits to all of its partners throughout the customer value chain. 
 
   -- Delivers best-in-class financial profile: The combination of James Hardie 
      and AZEK creates a company with an accelerated growth rate, peer-leading 
      profitability and robust cash generation. In the 12-month period ended 
      December 31, 2024, James Hardie and AZEK generated $5.9 billion in net 
      sales, more than $1.8 billion in adjusted EBITDA and adjusted EBITDA 
      margin of 31%, on a combined company basis and including the total 
      expected run-rate benefit of synergies. The transaction is also expected 
      to be accretive to James Hardie's cash earnings per share1 in the first 
      full fiscal year after the closing of the transaction. Once run-rate cost 
      synergies are achieved, the combined company is expected to generate 
      robust annual free cash flow of greater than $1 billion, which James 
      Hardie intends to use to support organic growth, deleverage and fund 
      ongoing share repurchases. Further, the transaction delivers return on 
      invested capital ("ROIC"2) in excess of James Hardie's cost of capital 
      within the medium term. James Hardie plans to execute up to $500 million 
      of share repurchases in the 12 months after the closing of the 
      transaction. At close, pro forma leverage is expected to be 2.8x net 
      debt to LTM adjusted EBITDA. James Hardie is targeting a leverage ratio 
      below 2.0x net debt to LTM adjusted EBITDA, inclusive of share 
      repurchases, by the end of the second full fiscal year after the closing 
      of the transaction. The combined business is also well positioned for a 
      valuation uplift as a leading growth platform in building products with a 
      strengthened financial profile, and greater global institutional investor 
      relevance through two major stock exchange listings. 
 
   -- Unlocks significant value through cost and commercial synergies: Through 
      at least $125 million of cost synergies and $500 million of commercial 
      synergies, James Hardie expects to achieve at least $350 million of 
      additional annual adjusted EBITDA. The full run-rate impact of cost and 
      commercial synergies is expected to be realized three and five years post 
      the closing of the transaction, respectively. The commercial synergies 
      are underpinned by significant wallet share opportunities with each 
      company's existing contractor network and customer base, as well as 
      through enhanced offerings and a national footprint across North America. 
      As a result, the Company believes there could be meaningful upside to the 
      commercial synergies. 

Governance and Leadership

James Hardie CEO Aaron Erter will serve as Chief Executive Officer, and James Hardie CFO Rachel Wilson will serve as Chief Financial Officer, of the combined company.

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March 23, 2025 16:37 ET (20:37 GMT)