Published on 6 Mar 2024 on Zacks via Yahoo Finance

Koppers (KOP) Acquires Brown Wood to Boost Utility Business

Koppers Holdings Inc. KOP recently announced that its subsidiary, Koppers Utility and Industrial Products Inc. (UIP), entered into an agreement to acquire the majority of assets belonging to Brown Wood Preserving Company, Inc. and select affiliates. The acquisition, valued at approximately $100 million in cash, is anticipated to be completed in the second quarter of 2024, pending customary closing conditions.

Brown Wood specializes in the manufacture and distribution of pressure-treated wood utility poles. Upon completion of the transaction, Brown Wood will be integrated into Koppers' operations, enhancing its service offerings and expanding its geographic presence. James Sullivan, president and chief operating officer of Koppers, expressed enthusiasm for the integration, emphasizing the potential synergies and expanded capabilities it brings to Koppers' utility business.

Koppers highlighted the strategic significance of the acquisition, aligning with its strategic goal to bolster its utility pole treatment business through organic growth and acquisitions. While the acquisition may not significantly impact 2024 financial results due to timing and integration expenses, Koppers anticipates that it will help it achieve an adjusted EBITDA in the range of $315-$325 million in 2025.