German manufacturer Knauf has agreed to buy Chicago-based USG for $7 billion, the companies announced Monday.
Under the terms of the deal, Knauf will pay USG shareholders $44 per share, which represents a 31 percent premium to Friday's closing price.
The transaction, which is expected to close in early 2019, brings together two building materials giants. USG will continue to be headquartered in Chicago after the merger, according to a joint news release issued by the companies.
"Our board has worked diligently to evaluate all strategic options to maximize value for our shareholders, and we are pleased to have reached this agreement, which provides our shareholders with significant and certain cash value," Jennifer Scanlon, president and chief executive officer of USG, said in the release. "We believe this transaction will create new opportunities for both companies' customers and will benefit USG's employees, who will be part of a truly global building products company."
The proposed merger was unanimously approved by USG's board. Berkshire Hathaway, which owns about 31 percent of outstanding USG shares, has agreed to vote in favor of the transaction, which requires shareholder and regulatory approval.
