Gypsum industry news

US: Warren Buffett, the chief executive officer Berkshire Hathaway, plans to oppose the election of four board nominees at USG. The move places pressure on USG to accept a hostile takeover bid for US$6.6bn by Germany’s Knauf, according to the Financial Times newspaper. “Berkshire’s present intention is to vote against the four directors proposed by management,” said Debbie Bosanek, an assistant to Buffett. The talks between USG and Knauf were enabled in March 2018 by Berkshire Hathaway offering to sell its 31% stake in USG to Knauf. The German company holds a 10.5% stake in USG.

US: USG has said that Knauf has misinterpreted its rejection of US$5.9bn bid following a letter from Knauf to USG shareholders asking them to vote against director nominees. Knauf sent a letter to its fellow shareholders asking them to send a ‘clear message’ to the board of USG to ‘engage in discussions with Knauf’ regarding its offer.

"Knauf's letter mischaracterises our board's actions. Our board has clearly demonstrated that it is willing to evaluate any opportunity to deliver value to all of our shareholders. We have engaged with Knauf in good faith on multiple occasions since November 2017. Jenny Scanlon and I met in person with Alexander Knauf and Manfred Grundke on 12 March 2018. Additionally, at the direction of our board, our financial and legal advisors met with Knauf's advisors as recently as last Thursday. The fact is their proposal is wholly inadequate, opportunistic and does not reflect the intrinsic value of the company," said Steven Leer, USG's non-executive chairman of the board.

Jennifer Scanlon, the president and chief executive officer of USG, added that she had met with and spoken to Knauf's senior management ‘multiple times’ but that it had not indicated any willingness to pay ‘full value’ for the company.

US: The commissioners of New Hanover country in North Carolina have approved a US$0.35m incentive package for National Gypsum to open its Wilmington wallboard plant. The package will be offered over five years if the wallboard producer meets benchmarks that include investing US$25m in the plant and hiring at least 51 people at the site, according to the Star News newspaper. The city of Wilmington is also considering offering a package of US$0.23m. However, pollution concerns have been aired at public hearings about re-starting the plant.

US: USG has rejected a proposal by Germany’s Knauf to buy all of its shares for US$42/share in cash or for around US$5.9bn. Jennifer Scanlon, president and chief executive officer of USG, described the offer as ‘wholly inadequate’ and said that it ‘substantially’ undervalued the company. She added that USG had discussed the proposal on the telephone with Knauf in December 2017 and met in mid-March 2018. Knauf submitted a revised proposal around the same time.

US: Underwriters Laboratories (UL) has completed fire performance evaluation on some of USG’s Sheetrock Brand EcoSmart Panel products. The testing concluded that 15.9mm USG Sheetrock Brand EcoSmart Panels Firecode X (UL Type ULIX) and USG Sheetrock Brand EcoSmart Panels Mold Tough Firecode X (UL Type ULIX) is specified in more than 260 fire-rated wall, column, and floor- and roof-ceiling UL designs in which Type X or Type C panels are required.

“Quickly and accurately identifying gypsum panel types in the field – especially after the panels have been hung and the joints are finished – can be challenging. Consequently, fire performance may be compromised if Type X panels are inadvertently hung as the ceiling membrane, whether in steel or wood construction, when Type C panels are required,” said Nestor Sanchez, senior manager, building science at USG.

US: Taishan Gypsum and its owner China National Building Material Company (CNBM) have reached a US$1.38m settlement with Meritage Homes of Florida. According to the terms of the agreement Taishan and its fellow subsidiary Beijing New Building Material (BNBM) have agreed to pay Meritage in instalments by the end of March 2018. In return Meritage has agreed to withdraw all claims and allegations against Taishan Gypsum and BNBM following full receipt of the payment.

US: USG has submitted a purchase application to the Michigan Department of Natural Resources (DNR) to expand its operations for its gypsum quarry at Alabaster, Michigan. The wallboard producer wants to buy 580 acres of state property adjacent to the sitem according to the Associated Press. The DNR says it will study the company's plan, considering issues involving forestry, wildlife, fisheries, recreation and minerals. It also will consult with tribal governments and host a public meeting.

USG founded the Alabaster quarry in 1902 and it employs 20 workers at the site. Customers for gypsum from the mine include LafargeHolcim cement plant in Alpena, Michigan and St Marys Cement’s cement grinding plant in Detroit. It says it wants to expand the quarry in order to extend its life span.

US: United States Geoogical Survey (USGS) data reports production of gypsum-based board products rose by 2.4% year-on-year to 2.35Mm² in 2017 from 2.29Mm² in 2016. Mined gypsum production increased by 7% year-on-year to 18.2Mt in 2017 from 16.7Mt in 2016. Synthetic gypsum supply rose by 4% to 16.7Mt from 16Mt. Imports of crude gypsum rose by 12.7% to 4.89Mt from 4.34Mt. The major importing countries remained Mexico, Canada and Spain. Exports of gypsum board products fell by 30% to 0.71Mt from 1.01Mt. The mjaority of these products were exported to Canada.

US: Ultimate Software says that National Gypsum is using its UltiPro product to manage its human resources system. The gypsum wallboard producer is using the product to address challenges in manufacturing and cost control and manage its skilled workforce. National Gypsum started working with Ultimate Software in 2004 and it launched UltiPro's talent management solutions in 2015.

"I can say without exaggeration we are creating ad-hoc reports daily that look at data such as labour allocation, succession planning and global demographics," said Bruce Williams, director of human resources at National Gypsum. He added that the real-time reports aid the company to adapt to industry conditions, extend key resources and make cost savings. The software product has also enabled National Gypsum to reduce the size of its human resources team.

US: Ann Franzen, the plant manager of USG’s gypsum wallboard plant in Rainier, Oregon has been recognised by the Manufacturing Institute as part of its annual Science, Technology, Engineering and Production (STEP) Ahead Awards. This marks the fourth consecutive year a USG employee has received this honour for her contributions to the manufacturing industry. The STEP Ahead Awards honour women who have demonstrated excellence and leadership in their careers and represent all levels of the manufacturing industry, from the factory-floor to the executive level.

Franzen, a STEP Ahead Honouree, joined USG more than 20 years ago. She became USG’s first female plant manager and has played a role in USG’s lean management initiative. Franzen is also a founding member of USG’s Women in Manufacturing group, which connects female plant employees across the USG network and promotes career advancement.

The STEP Ahead Awards are part of the larger STEP Ahead initiative, launched to examine and promote the role of women in the manufacturing industry through recognition, research, and leadership for attracting, advancing, and retaining strong female talent. In five years, STEP Ahead Award winners have impacted more than 300,000 individuals — from peers in the industry to school-aged children. The Manufacturing Institute will recognize all 130 recipients of the STEP Ahead Awards on 10 April 2018 at a reception in Washington, DC.