Commercial Metals Company announced a $2 billion senior unsecured notes offering under Rule 144A, intended to fund the purchase of Foley Products Company, cover transaction‑related fees, and support general corporate purposes. The notes will rank equally with existing senior unsecured debt and will be redeemed at 100 % of the issue price plus accrued interest on October 15 2026 if the Foley acquisition is not closed by that date.
The Foley acquisition, valued at $1.84 billion, is a cornerstone of Commercial Metals’ strategic shift toward early‑stage construction solutions. Combined with the earlier purchase of Concrete Pipe & Precast, the company will become the third‑largest precast concrete platform in the United States. Management projects $25 million to $30 million in annual run‑rate synergies by year three, a 210‑basis‑point lift in core EBITDA margin on a pro‑forma basis, and a net debt‑to‑adjusted EBITDA ratio of roughly 2.7×, with a target of below 2.0× within 18 months.
In its most recent quarter, Commercial Metals reported adjusted earnings per share of $1.37 versus an estimate of $1.35, and revenue of $2.10 billion versus an estimate of $2.09 billion. Net earnings rose to $151.8 million from $103.9 million a year earlier, driven by expanding margins in the North America Steel Group and record performance in the Emerging Businesses Group. In the first quarter of fiscal 2025, the company posted a net loss of $175.7 million, largely due to a $265 million litigation charge; adjusted earnings were $88.5 million versus an estimate of $0.91, and revenue was $1.90 billion, with margins pressured by lower steel and downstream product pricing.
Peter Matt, President and CEO, said the Foley acquisition “presents a unique opportunity to create immediate scale for our precast platform while adding a best‑in‑class business with industry‑leading margins.” He added that fiscal 2025 “was a pivotal year for CMC as we laid the groundwork of our transformative strategy.” Regarding the litigation charge, Matt stated the company is “very confident in our business practices and is pursuing all appropriate avenues to appeal the decision.”
The notes offering provides the liquidity needed to close the Foley deal and supports Commercial Metals’ debt‑repayment plan, reinforcing its transition from a traditional steel manufacturer to a provider of early‑stage construction solutions. Fitch Ratings views the acquisition as credit positive, anticipating improved margins and free cash flow. The enhanced precast platform is expected to strengthen the company’s financial profile and accelerate growth in the precast market.
Corporate governance updates include the retirement of Sarah E. Raiss from the board and the resignation of Jennifer J. Durbin, Senior Vice President and Chief Human Resources and Communications Officer. These changes underscore the company’s focus on strengthening its governance structure while pursuing its strategic transformation.
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