Commercial Metals Company today announced it has entered into a definitive agreement to acquire TAC Acquisition Corp. (Tensar), a portfolio company of Castle Harlan Inc.'s fund, Castle Harlan Partners V, L.P., and a leading global provider of engineered solutions for subgrade reinforcement and soil stabilization used in road, infrastructure and commercial construction projects.
The transaction, valued at $550 million, is subject to customary purchase price adjustments and is not contingent on any financing arrangements. The purchase price represents a multiple of 8.4x Tensar's expected 2021 EBITDA, inclusive of clearly executable cost synergies of approximately $5 million.
"This compelling acquisition advances CMC's strategy to expand our leadership in construction reinforcement, with value-added products that complement our existing offering," said Barbara R. Smith, Chairman of the Board, President and Chief Executive Officer of Commercial Metals. "Tensar will create a powerful platform for incremental growth into complementary high-margin engineered products that target CMC's largest core market, construction, serving end-use markets and customer segments where we have strong and existing relationships. Once complete, this transaction will strengthen CMC's position as a global reinforcement solutions provider, capable of addressing multiple early phases of commercial and infrastructure construction, including subgrade, foundation, and structures."