James Hardie Industries PLC (ASX:JHX) has agreed to sell its European Fermacell business to Holcim for €840 million in cash as part of a broader move to exit Europe and sharpen its focus on higher-growth markets.
Investors have reacted positively to the news with shares rising 0.58% to $43.05 in morning trade.
The transaction covers James Hardie’s European sustainable walling and flooring operations, including the fermacell and Aestuver brands. The company also intends to close its separate European fibre cement business, subject to regulatory, legal and employee consultation requirements.
James Hardie said the divestiture is expected to improve its margin profile and return on invested capital while strengthening the balance sheet and supporting shareholder returns.
Debt reduction and capital returns
Around US$600 million of the proceeds is expected to be directed toward debt repayment, accelerating progress towards James Hardie’s target of reducing net leverage to below 2.0 times by September 30, 2027.
The board has also authorised a new US$250 million share repurchase program, with shares potentially acquired through open-market purchases, accelerated repurchases or other methods depending on market conditions.
Chief executive Aaron Erter said the European exit would allow the company to concentrate capital and management attention on its “highest growth and return opportunities”.
Holcim to take control of Fermacell
Following completion, Fermacell will become part of Holcim’s building systems and modular construction portfolio, while existing Fermacell chief executive Christian Claus will continue to lead the business.
The transaction is expected to close in the first half of calendar 2027, subject to regulatory approvals and required employee consultation processes.
The deal forms part of James Hardie’s strategy to concentrate its portfolio on core growth regions, with the company retaining its operations across North America, Australia and New Zealand following the planned European exit.