Carlyle Eyes Tamko Sale, Valuation Could Top $3.5B

Key Takeaway

• Carlyle Group, in partnership with Tamko's family owners, is considering selling the roofing shingle manufacturer, potentially valuing it over $3.5 billion.
• The building products sector is experiencing consolidation, with significant acquisitions like Holcim’s purchase of Duro-Last and Owens Corning’s acquisition of Masonite for $3.9 billion.
• Carlyle's investment in Tamko through its Global Partners fund highlights strategic business separations and the Humphreys family's continued control over certain operations.

Exploring Strategic Options

Carlyle Group Inc., in collaboration with the family owners of Tamko Building Products, is contemplating a sale of the roofing shingle manufacturer, potentially valuing the company at over $3.5 billion. This consideration is part of a strategic review being conducted with the assistance of an advisor. Carlyle, an investment firm, acquired a minority stake in Tamko in 2019, the specifics of which were not disclosed. The review process is being undertaken alongside Tamko’s majority owner, the family of Chairman and CEO David Humphreys. It's important to note that the initiation of an auction process has not occurred, and there remains the possibility that the owners may decide against a sale.

Industry Consolidation

The building products sector has witnessed a series of acquisitions, indicating a trend towards consolidation within the industry. Notable transactions include Holcim Ltd.’s acquisition of Duro-Last Inc., Bridgestone Corp.’s purchase of its Firestone Building Products unit, and Owens Corning’s agreement to acquire Masonite International Corp. for $3.9 billion in February. A potential sale of Tamko would contribute to this ongoing consolidation, particularly in the roofing space, where larger firms are seeking to expand their market presence.

Investment Details

Carlyle's investment in Tamko was made through its Carlyle Global Partners fund, which focuses on long-dated investments. Despite the investment, the Humphreys family has maintained ownership of the composite decking business, operating it as an independent entity. This strategic separation of business units underscores the family’s continued influence and control over key segments of their operations.