Owens Corning Inc · NYSE:OC
Owens Corning — Merger or Acquisition (February 2024)
17 slides from Owens Corning's merger presentation, Feb 9, 2024
Slide 1: Owens Corning Makes Transformative Moves to Strengthen Position in Building and Construction Materials
OWENS CORNING MAKES TRANSFORMATIVE MOVES TO STRENGTHEN POSITION IN BUILDING AND CONSTRUCTION MATERIALS Brian Chambers | Chair & Chief Executive Officer Todd Fister | Chief Financial Officer February 9, 2024
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements present our current forecasts and estimates of future events. These sta
Slide 3: Agenda
AGENDA Owens Corning enters into definitive agreement to acquire Masonite and initiates review of strategic alternatives for glass reinforcements business TRANSACTION HIGHLIGHTS Brian Chambers PROGRESS ON ENTERPRISE STRATEGY Brian Chambers MASONITE OVERVIEW Brian Chambers STRATEGIC RATIONALE Brian C
Slide 4: Strengthening Position in Building and Construction
STRENGTHENING POSITION IN BUILDING AND CONSTRUCTION TRANSACTION DETAILS STRATEGIC RATIONALE Owens Corning to acquire Masonite for Expands Owens Corning’s leadership $133.00 per share or ~$4b in cash 1 position in branded residential building products Implies ~8.6x 2023E adjusted EBITDA1, or ~6.8x in
Slide 5: Enterprise Strategy for Growth
ENTERPRISE STRATEGY FOR GROWTH ENTERPRISE STRATEGY “THE OC ADVANTAGE” KEY SECULAR TRENDS Strengthen position in core 1 products and markets High Premium on Performing living space Expand into new product Teams 2 adjacencies that leverage our Material Sustainability Science material science, market,
Slide 6: Transformative Progress on Enterprise Strategy
TRANSFORMATIVE PROGRESS ON ENTERPRISE STRATEGY Q4 2021 WEARDECK NATURAL FIBERTEQ JV MAJOR ORGANIC MASONITE INVESTOR DAY ACQUISITION POLYMERS ACQUISITION GROWTH ACQUISITION Owens Corning Continues pivot of ACQUISITION Expands capacity of INVESTMENTS Leadership establishes strategy Composites business
Slide 7: A Market Leader in North American Residential Doors
A MARKET LEADER IN NORTH AMERICAN RESIDENTIAL DOORS 2,892 2,982 2,597 2,177 2,257 2019 2020 2021 2022 2023 1 Residential Interior Doors Residential Exterior Doors Components and Door Systems REVENUE ($mm) Architectural Europe New Construction Canada Residential R&R ~10% ~10% ~45% ~10% ~55% 446 454 U
Slide 8: Expands Branded Residential Building Materials
1 EXPANDS BRANDED RESIDENTIAL BUILDING MATERIALS HIGHLY VALUED PRODUCTS AND BRANDS STRONG CHANNEL REACH Builders Contractors Distributors Home Centers Homeowners 8
Slide 9: Creates Scalable New Growth Platform
2 CREATES SCALABLE NEW GROWTH PLATFORM A MARKET LEADER IN RESIDENTIAL BUILDING MATERIALS $3b1 $10b1 $13b1 • A market leader in North • A leader in North American • Best in-class brands, shared American doors and door systems building materials customer and channel knowledge, manufacturing excellence
Slide 10: Enhances Financial Profile: $2.9B Pro Forma Adjusted EBITDA
3 ENHANCES FINANCIAL PROFILE: $2.9B2 PRO FORMA ADJUSTED EBITDA $12.6b $2.9b MASONITE Synergies 5.4% ($125mm) 5.1% MASONITE OWENS PRO CORNING FORMA OWENS CORNING OWENS CORNING 4.0% MASONITE PRO FORMA REVENUE1 PRO FORMA ADJUSTED EBITDA2 PRO FORMA CAPEX AS % OF SALES3 1. Pro forma revenue based on 2023
Slide 11: Driving Value Creation with Cost Synergies
3 DRIVING VALUE CREATION WITH COST SYNERGIES ~$125mm OF ACHIEVABLE RUN-RATE SYNERGIES UPSIDE OPPORTUNITIES RESULTING IN ~$125mm SOURCING AND SUPPLY CHAIN SG&A Commercial execution ~20% ADJUSTED Material science EBITDA MARGIN driven innovation Manufacturing ROIC1 > WACC efficiencies BY END OF YEAR 3
Slide 12: Generates Strong Free Cash Flow
3 GENERATES STRONG FREE CASH FLOW DELEVERAGING THROUGH CASH FLOW GENERATION FREE CASH FLOW ACCRETION WITHIN TARGET RANGE OF 2-3X ~2x Expect low double-digit percentage accretive to free cash flow after financing costs by end of 2025 At Close (Expected Mid-2024) Year End 2024 NET-DEBT / EBITDA REINFO
Slide 13: Transaction Details
TRANSACTION DETAILS • Owens Corning to acquire Masonite for $133.00 per share in cash PURCHASE • Represents a 38% premium to the closing share price on February 8, 2024 PRICE • Total enterprise value of ~$4b implying ~8.6x 2023E Adj. EBITDA1, or ~6.8x including synergies of ~$125mm • Transaction to
Slide 14: Initiating Strategic Review of Glass Reinforcements Business
INITIATING STRATEGIC REVIEW OF GLASS REINFORCEMENTS BUSINESS Owens Corning initiating a strategic review process for glass reinforcement business Operates within Composites segment and is one of the largest providers of glass reinforcements for wind energy, infrastructure, industrial, transportation
Slide 15: Strengthening Position in Building and Construction
STRENGTHENING POSITION IN BUILDING AND CONSTRUCTION Expands Owens Corning’s leadership position in branded 1 residential building products Creates scalable new growth platform leveraging combined + 2 commercial, operational, and innovation capabilities 3 Enhances Owens Corning’s attractive financial
Slide 16: Additional Information
ADDITIONAL INFORMATION This communication relates to proposed transactions contemplated by the Arrangement Agreement (the “Agreement”) by and among Owens Corning (“Owens Corning”), Masonite International Corporation (“Masonite”) and MT Acquisition Co ULC (the “Transaction”). This communication does
Slide 17: Participants in the Solicitation
PARTICIPANTS IN THE SOLICITATION Masonite, Owens Corning and certain of their directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the Transaction. Information regarding the persons who may, under the rules of the SEC, be deemed participants
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