CLEVELAND — The $7 billion acquisition of USG Corp. by Gebr. Knauf KG has been completed.

The deal was announced last June.

“This transformational transaction is the largest acquisition in Knauf’s history and, accordingly, presents significant opportunities to create a stronger, more sustainable company for our employees, customers and communities,” said Alexander Knauf, General Partner of Knauf. “We greatly admire USG’s strong brands, leading market positions in North American wallboard and ceilings, and highly talented employee base. We are excited to welcome USG employees to the Knauf family and look forward to working together to accelerate growth and profitability and even better serve our customers.”

Chris Griffin, incoming CEO of USG, further commented, “I am excited to be back at USG, working with a talented USG team and Knauf leadership to make this combination a huge success. Our immediate priorities are ensuring a smooth transition for our employees, helping our customers be successful by putting them at the center of everything we do and driving operational excellence across the business.”

USG stockholders will receive $43.50 in cash for each share of USG common stock held at the effective time of the merger, without interest and subject to tax withholding as applicable. This closing consideration is in addition to the special dividend of $0.50 per share of USG common stock that was previously paid on Oct. 2, 2018 to holders of record as of the close of business on Aug. 21, 2018.

"Although the deal had a long gestation period, the end result is a company that will be a drywall industry giant," said Ken Long, manager of construction industry studies at the Freedonia Group, in a separate press release.       

According to Long, "By combining the second and third producers globally, the acquisition significantly strengthens Knauf's competitive position in the world drywall and building plaster industry, an industry in which Saint-Gobain was previously the undisputed market leader."

The transaction also considerably boosts the size of Knauf's North American business operations. The company is the largest European supplier of drywall — also called gypsum board, plasterboard, and wallboard — and has manufacturing operations in the Africa/Mideast region, Asia, and Central and South America. However, Knauf did not previously have a significant presence in the U.S. drywall and plaster market, where USG is the industry leader.

"The combined company will benefit from other synergies as well," said Long. Knauf and USG both manufacture ceiling products, and the merged enterprise will gain greater economies of scale by combining Knauf's European ceiling business with the US ceiling operations of USG.

Knauf has also announced its intention to integrate its North American insulation division with USG's drywall, ceiling, flooring, roofing, and sheathing product businesses, making the company a leading broadline light building materials supplier in the U.S. and Canada.