Boral (ASX:BLD) share price edges lower on divestment news

The company is offloading one of its businesses…

| More on:
A man stands in front of a chart with an arrow going down and slaps his forehead in frustration.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Boral Limited (ASX: BLD) share price is trekking slightly lower today following the company’s update on its Australian timber business. 

During morning trade, Boral shares are fetching for $7.40, down 0.13%. It’s worth noting that its shares are near its 52-week high of $7.43 reached last week.

Boral agrees to sell timber business

In today’s statement, Boral announced it has entered into an agreement with Allied Natural Wood Enterprises (ANWE) to sell its Australian hardwood and softwood timber business.

Headquartered in New South Wales, Australia, ANWE is a leading wood products export marketing and logistics company. ANWE concentrates on the export of woodchip and other wood products to the international markets. The company is part of the Pentarch Group, an established Australian logistics business.

Under the deal, Boral will sell its timber business for $64.5 million. The agreement is subject to the usual customary conditions upon closing the transaction.

The proceeds of the sale will be used to improve the company’s net debt position after allowing for reinvestment needs. Any remaining monies left over will be distributed to shareholders.

Boral noted that the divestment is in line with its strategy of focusing on strengthening its core assets and delivering improved returns.

Boral CEO and managing director, Zlatko Todorcevski commented:

The sale of Boral’s Timber business represents another important milestone in focusing our portfolio and positioning for the future.

In Australia, our focus is on our leading integrated construction materials business and maturing our adjacent growth strategies such as recycling, waste, supplementary cementitious materials and lower carbon products.

The sale of Boral’s Timber business to the Pentarch Group, a private company with growing interests in the forest products sector, is a good outcome for this business and its customers.

The sale is expected to be completed sometime later this year.

Boral share price snapshot

In the last 12 months, Boral shares have continued to accelerate, posting a gain of close to 100%. Year-to-date, the company’s share price has jumped around 50% to hit a 52-week high of $7.43 last Wednesday.

Boral presides a market capitalisation of around $8.1 billion, with over 1.1 billion shares on its books.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Young woman using computer laptop smiling in love showing heart symbol and shape with hands. as she switches from a big telco to Aussie Broadband which is capturing more market share
Share Market News

Here are the top 10 ASX 200 shares today

These ASX 200 stocks outperformed all their peers on Monday.

Read more »

Group of friends trading stocks on their phones. symbolising the 3 most traded ASX 200 shares today
Share Market News

Here are the 3 most heavily traded ASX 200 shares on Monday

One of our most-traded ASX 200 shares has dropped 12 % today.

Read more »

a man sits in casual clothes in front of a computer amid graphic images of data superimposed on the image, as though he is engaged in IT or hacking activities.
Cryptocurrencies

Will the next era of computing break the Bitcoin price or boost it?

Cryptos have taken a beating over the past months as interest rates around the world ratcheted higher. But is there…

Read more »

A man sitting at his dining table looks at his laptop and ponders the CSL balance sheet and the value of CSL shares today
Bank Shares

Is the CBA share price overvalued compared to other ASX 200 banks?

CommBank is the most exposed to any downturn in the Aussie housing market.

Read more »

a man with hands in pockets and a serious look on his face stares out of an office window onto a landscape of highrise office buildings in an urban landscape
Real Estate Shares

GPT share price lifts despite 30% profit plunge

Here's how GPT Group is shaking off a poor headline figure to move higher today...

Read more »

The words short selling in red against a black background
Share Market News

These are the 10 most shorted ASX shares

Short sellers are currently targeting these ASX shares...

Read more »

A woman sits at her computer with her hand to her mouth and a contemplative smile on her face as she reads about the performance of Allkem shares on her computer
Share Market News

Did you know you’re investing in lithium when you buy Wesfarmers shares?

Lithium is part of Wesfarmers’ future.

Read more »

Three business people join hands in strength and unity
Share Market News

Here are 3 ASX blue-chip shares reporting this week

Keep your eyes peeled for reports from these ASX heavyweights.

Read more »