The Bottom Line 6-28
June has shaped up to be an active month for the Building Products and Materials sector. Under pressure from activist shareholder Sachem Head Capital, Eagle Materials started the month off announcing the decision to separate its Heavy Materials and Light Materials divisions. Masco last week announced an update to its previously announced intent to explore strategic alternatives for the Cabinets and Window segments, focusing on selling Masco Cabinetry, Milgard Windows, and UK Window Group in three separate transactions. Summit Materials lost its COO Karl Watson, Jr. mid-June, and last week, news crossed of his appointment as CEO of Forterra, starting July 8th. Watson will take his turn-around expertise to a company in great need for a fresh set of eyes. Note that Summit’s largest shareholder (11% position), Southeastern Asset Management, made waves with TXI Industries a year ago, helping to pave the way for the sale to Martin Marietta. Finally, last week we wrote about Owens Corning’s 8K filing with changes regarding shareholder proposals, a filing that appeared to be a proactive move in advance of potential activist shareholder pressures. Mid-week news hit the tape of a potential activist seeking value-creating alternatives for OC.