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Tustin-based Foundation Building Materials Inc. (NYSE: FBM), a distributor of building products, said Thursday it will sell its mechanical insulation business to Dunes Point Capital LP of Rye, N.Y., for $122.5 million.
The deal is expected to close during the fourth quarter.
Net proceeds of about $116 million from the transaction will be used to help pay down Foundation’s debt.
The company’s mechanical insulation segment distributes and fabricates commercial and industrial insulation products in the U.S. and Canada.
Foundation’s shares were up 5% in midday trading; it counts a market value of about $570 million.