Eagle Materials to delay business separation due to coronavirus

By |  April 13, 2020

Logo: Eagle Materials

Eagle Materials, which plans to separate its heavy and light materials businesses into independent, publicly-traded companies, will hold off on the separation due to market conditions caused by the ongoing coronavirus (COVID-19) pandemic.

In a statement, Eagle Materials says it “remains committed to the separation and reaffirms that the strategic rationale for the separation is unchanged, although the timing for the expected completion of the separation has become uncertain. The company continues its preparation to ensure that the two businesses are well-positioned for the separation when the markets recover.”

According to the company, Eagle’s primary manufacturing facilities span the United States in areas where construction has generally been deemed essential by government authorities. Plus, Eagle has adapted its operations during the pandemic.

“As our nation reacts to COVID-19 and the large-scale effort to contain it, we remain focused on navigating the crisis, keeping our employees and their families healthy, serving our customers as an essential business, and protecting the financial stability of Eagle during these uncertain times,” says Michael Haack, president and CEO at Eagle Materials. “These steps are part of a broad array of internal actions we are taking to manage our cash flow and to be prepared in light of these conditions. Just as we entered this environment in a strong financial position, we are taking immediate actions to reduce expenses and manage liquidity so we can maintain strong financial footing as we move forward beyond it.”

In addition, Eagle Materials has implemented health and safety protocols to safeguard employees who work at Eagle facilities or customer jobsites, including restricting visitor access to facilities, enforcing social distancing protocols, additional facility-cleaning procedures, and other policies and practices that are consistent with or exceed guidelines from the Centers for Disease Control and Prevention.

Aside from additional health and safety precautions, Eagle Materials is also taking “prudent and precautionary actions to maintain its financial flexibility,” the company says in a statement. These measures include limiting capital spending to critical maintenance, safety and regulatory projects; managing the timing and duration of maintenance programs; and amending Eagle’s bank credit facility and term loan to extend the maturity from August 2021 to August 2022.

For more P&Q coverage related to the coronavirus, visit our dedicated webpage.

This article is tagged with , , , , , , , and posted in COVID-19, News
Avatar photo

About the Author:

Comments are closed