Armstrong World Industries to Sell EMEA and Pacific Rim Businesses to Knauf International

January 2018

Armstrong World Industries, Inc., Lancaster, Pa., has entered into a definitive agreement with Knauf International GmbH, to sell its EMEA and Pacific Rim businesses to Knauf for an enterprise value of $330 million, nearly 13 times adjusted EBITDA for the combined AWI and WAVE businesses. The agreement includes the businesses of the WAVE joint venture in EMEA and the Pacific Rim, as well as Armstrong France and WAVE France, for which Knauf made a binding and irrevocable offer, subject to consultation with the local works councils. AWI currently anticipates that after customary closing adjustments, taxes and fees it will realize approximately $250 million in transaction related net cash. The transaction, which is subject to regulatory approvals and other customary conditions, is currently anticipated to close in mid-2018.
    
AWI’s current guidance for the EMEA and Pacific Rim businesses anticipate 2017 sales of approximately $425 million with adjusted EBITDA of approximately $22 million. Including 100 percent of WAVE’s EMEA and Pacific Rim earnings, the transaction was valued on a combined standalone last twelve months adjusted EBITDA of $26 million. AWI and WAVE currently employ over 1,900 people in 36 countries and together operate 11 facilities in seven countries across these regions.
    
AWI currently anticipates returning a majority of the net proceeds to shareholders, in a manner and timing to be approved by its board of directors.