Nashville, TN-based manufacturer and distributor of building
), and resource management service provider,
Casella Waste Systems Inc.
), have recently divested their respective interests in the US
GreenFiber, LLC joint-venture to the private equity firm, Tenex
Capital Management. The sale, announced on Dec 5, 2013, is valued
at $18.0 million.
GreenFiber is primarily engaged in manufacturing natural fiber
insulation products required for the construction of residential,
home refurbishment and manufactured housing. It was formed in
2012 after a joint-venture deal with Casella Waste Systems and
Louisiana-Pacific. GreenFiber boasts a strong presence in the
U.S. market for the past 12 years and has achieved the status of
one of the largest companies in the insulation industry.
Louisiana-Pacific is highly optimistic about the divestiture.
We believe that the company has taken the strategic move to
invest the resources in more profitable areas and streamline its
business. Excluding working capital, debt and other transaction
costs, both Louisiana-Pacific and Casella Waste Systems will
receive net cash proceeds of $7 million from the sale.
Louisiana-Pacific is a premier supplier of building materials,
delivering innovative, high-quality commodity and specialty
products to its retail, wholesale, homebuilding and industrial
The company posted lower-than-expected earnings and revenues
during the third quarter of 2013. Lower Oriented strand board
(OSB) pricing, a slower recovery in the housing market and higher
operating costs seem to be responsible for such disappointing
performance. We believe that the overall economic recession will
continue to affect the company's business.
Louisiana-Pacific currently carries a Zacks Rank #3 (Hold).
Other stocks to watch out for in the sector are
Universal Forest Products Inc.
) with a Zacks Rank #1 (Strong Buy) and
Boise Cascade Co.
) with a Zacks Rank #2 (Buy).
BOISE CASCADE (BCC): Free Stock Analysis
CASELLA WASTE (CWST): Free Stock Analysis
LOUISIANA PAC (LPX): Free Stock Analysis
UNIVL FST PRODS (UFPI): Free Stock Analysis
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