Boral share price (ASX: BLD): where next?

The Boral share price continues to tick higher, with the stock up about 43% in the last six months.

It’s been a busy couple of days for Boral (ASX: BLD).

On Monday, the building and construction materials company announced that it had entered into an agreement with a subsidiary of Westlake Chemical Corporation to sell its North American Building Products business.

Under the deal, Boral said it would sell this business arm for USD$2.15 billion or AUD$2.9 billion, and, due to carried over losses, would not pay income tax off the back of the sale.

As a result of this deal, the company made a few key points about its debt position and treatment of surplus capital.

For one, Boral said post sale, it would reduce its net debt target to AUD$1.3 billion, down from AUD$1.5 billion. Importantly, based on the company’s net debt position as of 31 May, this would result in some AUD$500 million in surplus capital.

Looking at what the company may do with the proceeds from the sale, management noted that the Board was in the process of assessing its options in regards to the potential distribution of any surplus capital.

What's your view on Boral? Whatever you think, you can use CFDs to trade both rising and falling markets, through IG’s world-class trading platform now.

For example, to buy (long) or sell (short) Boral using CFDs, follow these easy steps:

  • Create an IG Trading Account or log in to your existing account
  • Enter ‘BLD’ in the search bar and select it
  • Choose your position size
  • Click on ‘buy’ or ‘sell’ in the deal ticket
  • Confirm the trade

Seven’s takeover offer in focus

While the sale of Boral's North American assets is significant, on Tuesday Boral’s management updated the market in regards to Seven Group Holdings’ off market takeover bid for the company.

As part of a statement released to the ASX, it was revealed that Seven had dropped all conditions relating to its takeover bid for Boral.

Despite loosening the terms of the deal, Boral’s Independent Board Committee continues to implore its shareholders to both reject and/ or take no action in regards to the takeover offer. The offer, which values Boral at $6.50 per share – undervalues the company according to Boral management.

Centrally, Boral’s Board highlighted the sale of the company’s North American Building Products business as one of the key reasons why the SGH deal undervalues the company, saying:

‘The sale is expected to generate significant surplus capital once the transaction closes. Based on Boral's financial framework, we estimate this surplus (prior to any reinvestment alternatives) to be ~$3.6 billion which equates to $3.02 per share.'

Management further added that 'The Company will determine the appropriate form of any return to shareholders, which may involve further shareholder approvals.'

Boral share price remains elevated

A cursory glance would indeed suggest that the offer undervalues the stock – at least in so far as what market participants are currently willing to pay for Boral – with the stock opening Tuesday’s session at $7.01 per share.

The Boral share price has risen ~43% in the last six months.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.


Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.