Australian Investment Blog
ASX:FBU 18/12/2018
Why is Fletcher Building (ASX: FBU) outperforming today
Stock
Fletcher Building (ASX: FBU) $4.72 as at 18/12/2018
Event
Construction product manufacturer Fletcher Building has bucked the market weakness to trade higher into the afternoon following the announcement of the sale of their Formica business.
Fletcher will receive $US840m for the sale of the international laminates and panels business that was deemed as non-core to the Fletcher business.
While there are a few regulatory hurdles to jump, no hiccups are expected and the company intends to complete the sale early next year. The acquirer, Broadview, is a Netherlands based holding company which mostly has exposure to material technology.
The deal has been seen as a positive for Fletcher with the sale price higher than the market could have expected. Just 4-weeks ago, the FBU share price fell significantly on soft guidance for FY19. The business was been squeezed by falling construction rates across Australia and New Zealand in both residential and commercial construction.
Comparable listed company Boral (ASX: BLD) is trading flat today, vs Fletcher adding +2.84% in the face of a broader market which is down -0.94%.
Fletcher Building (ASX: FBU) Chart
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