Australian building products maker Boral is partnering with a US firm to create a $US1.6 billion ($A1.68 billion) plasterboard and ceilings joint venture.
Boral has signed a deal with USG, the largest north American plasterboard manufacturer, to establish a joint venture covering the growing markets of Asia, Australasia and the Middle East.
It will be called USG Boral Building Products, combining Boral's Gypsum division with USG's existing Asian and Middle-Eastern businesses.
USG will pay Boral up $US500 million to bring the venture to a 50/50 partnership, reflecting the higher value of the assets the Australian company is contributing to the deal.
Boral will also receive up to $US75 million in future years, provided the venture reaches earnings targets over the next five years.
"The joint venture strategically aligns with Boral's goal to grow earnings from Asia over the long term by effective leveraging out extensive distribution position with complementary building product makers," Boral chief executive Mike Kane said.
The deal is expected to be completed by January 31, 2014, subject to conditions, including approval from the Foreign Investment Review Board.
Boral shares gained 28 cents, or 5.9 per cent, to $5.03.
Share
