Hardie to Move Headquarters to Mission Viejo
Australian construction materials giant James Hardie Industries Ltd. said Wednesday it will form a new global operating company and move it to Orange County later this year in a major corporate reorganization and recapitalization.
Hardie also said it will seek a New York Stock Exchange listing for shares of the new operating company, to be called James Hardie NV.
Hardie Industries, which has had a U.S. operation for almost a decade, said the upheaval is mainly on paper and will not result in plant closures, divestitures or loss of operational jobs among the company’s 4,300 workers worldwide. Six executives will transfer from Australia to the new headquarters in Mission Viejo.
The company makes and markets building materials in the United States, Australia, New Zealand and the Philippines. Its main products are fiber cement and gypsum.
It posted a profit of $27.5 million on sales of $854 million for its 1998 fiscal year ended March 31.
Company officials said the reorganization will enable Hardie to make better use of its U.S. unit, which employs 1,100 people at seven manufacturing plants around the country and accounts for 45% of Hardie’s worldwide revenue, 55% of its assets and 61% of its operating profits.
James Hardie USA already is headquartered in Mission Viejo and will share its offices with the world headquarters once the restructuring is completed in October.
Other U.S. facilities include fiber cement plants in Fontana; Tacoma, Wash.; Cleburne, Texas, and Plant City, Fla., and gypsum plants in Seattle, Las Vegas and Nashville, Ark.
As part of its plan, Hardie will sell its operating businesses and core assets to Hardie NV, which will be incorporated in the Netherlands.
Sydney-based Hardie Industries will retain its liabilities and nonessential assets, according to a company statement released Wednesday. A general shareholders meeting will be Sept. 25 in Sydney to approve the plan.
Hardie Industries also will sell a 15% stake in Hardie NV in a worldwide initial public offering and will seek to have the stock listed on the New York exchange.
Currently, Hardie Industries shares trade on the Australian Stock Exchange, where they closed Wednesday at $4.80 Australian, equal to $2.97 a share in U.S. dollars at Wednesday’s currency exchange rate. The company’s American Depositary Receipts (ADR)--a form of security that enables foreign firms’ equity to be traded in the U.S.--closed Wednesday at $6.13 (U.S.) in over-the-counter trading, up 75 cents. Each Hardie ADR represents two common shares.
Hardie Industries, founded in Australia in 1892, makes gypsum wall board, fiber-cement siding and roofing tiles, modular buildings and other construction products.
But having management and shareholders in Australia, the company said, creates an imbalance that causes “organizational and financial inefficiencies.”
The new Hardie NV expects to hire about a dozen support staff for its new Orange County office. Those relocating from Hardie Industries’ headquarters in Australia are the company’s chief executive, Keith Barton, as well as the chief financial officer, controller, general counsel, and managers of the human resources and corporate affairs departments, a spokesman said.
Barton will be chairman and chief executive of Hardie NV.
The board of the new company is expected to include three Hardie Industries directors, Hardie Industries’ chief financial officer and three new, U.S.-based appointees.
