James Hardie Industries plc (NYSE: JHX) has agreed to sell its Fermacell walling and flooring business in Europe to Swiss building materials company Holcim (SIX: HOLN) for €840 million, or approximately $980 million, in cash, according to a company press release.

The sale includes the fermacell® and Aestuver® brands. Separately, James Hardie said it intends to close its European fiber cement business, subject to regulatory, legal, and employee consultation requirements.

The transaction is expected to close in the first half of calendar 2027, pending regulatory approvals and required consultation processes.

James Hardie said it plans to use approximately $600 million of the proceeds to repay debt, with the goal of reaching a net leverage ratio below 2.0x by September 30, 2027. The company's board has also authorized a new $250 million share repurchase program, to be executed through open-market purchases, accelerated share repurchases, or other methods subject to market conditions.

Christian Claus, CEO of Fermacell and President of James Hardie Europe, will continue to lead the Fermacell business following the close of the transaction.

"The strategic divestiture of our European operations and the intended closure of the European fiber cement business will enable us to focus on our highest growth and return opportunities," said Aaron Erter, CEO of James Hardie.

Goldman Sachs & Co. LLC is serving as financial advisor to James Hardie, and DLA Piper is serving as legal advisor on the transaction.