Beacon Roofing Supply, Inc. (NasdaqGS:BECN) entered into a definitive merger agreement to acquire Roofing Supply Group, LLC from Clayton, Dubilier & Rice, Inc. for $1.1 billion on July 27, 2015. Under the terms of the agreement, RSG shareholders will receive approximately $286 million in cash and $291 million of Beacon common stock, and Beacon will refinance approximately $565 million of RSG's net debt. Beacon will finance the transaction with a $700 million revolving credit, $450 million term loan, a senior unsecured bridge financing of $300 million financing commitment from Wells Fargo Bank, National Association, WF Investment Holdings, LLC, Wells Fargo Securities, LLC and Citigroup Global Markets Inc. and from a private offering of $300 million in aggregate principal amount of senior notes.

Arvan will continue to manage the RSG business and report to Isabella. Philip Knisely, Chairman of RSG and an advisor to CD&R Funds, and Sleeper will join the Board of Directors. Following completion of the transaction, Isabella will continue to serve as President and Chief Executive Officer of the combined company, and Buck will remain Chairman of the Board of Directors. The transaction is subject to antitrust approvals, listing of shares on stock exchange and other customary closing conditions. The transaction has been unanimously approved by the Board of Beacon Roofing Supply and Roofing Supply Group as well as from the shareholders of Roofing Supply Group. As of August 13, 2015, the deal has received the early termination of the waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The transaction is targeted to close on October 1, 2015. The transaction is expected to be immediately accretive to adjusted earnings per share and to generate annual run-rate synergies of approximately $50 million.

Citigroup Inc. (NYSE:C) acted as a financial advisor to Beacon Roofing Supply, Inc., Schiff Hardin LLP and Sidley Austin LLP acted as a legal advisor to Beacon Roofing Supply, Inc., Deutsche Bank Securities Inc. and Goldman, Sachs & Co. acted as a financial advisor to Roofing Supply Group, LLC and Debevoise & Plimpton LLP acted as a legal advisor to Roofing Supply Group, LLC. Gary M. Friedman, Meir D. Katz, Jeffrey E. Ross, Lee Turnier Barnum, Rafael Kariyev, Tomer S. Dorfan, Manuel Andres Giner, David P. Iozzi, Molly F. Stockley, Ramya S. Tiller Lale Uner, Margaret Andrews Davenport and Michael A. Diz of Debevoise & Plimpton LLP acted as legal advisor for Clayton, Dubilier & Rice. Daniel Wolf and Joshua Zachariah of Kirkland & Ellis LLP acted as legal advisor to Citigroup Inc. (NYSE:C).

Beacon Roofing Supply, Inc. (NasdaqGS:BECN) completed the acquisition of Roofing Supply Group, LLC from Clayton, Dubilier & Rice, Inc. on October 1, 2015.