Armstrong To Split Into Two Separate Companies

Lancaster, PA, Feb. 23, 2015 -- Armstrong World Industries said it plans to split the company into two separate publicly-traded businesses, one focusing on flooring and the other on ceilings.

"Armstrong believes that separating its Flooring and Ceilings businesses will create two strong companies that are leaders in their respective markets and that will benefit from increased strategic focus, streamlined operating structures and improved capital allocation," the company said in a press release.

"Each public company will offer investors a distinct and compelling investment opportunity based on different operating and financial models, end-market business cycles and strategic growth opportunities."

CEO Matthew J. Espe said the move was about creating shareholder value.

"We expect both businesses to improve their industry-leading positions and maximize their strategic opportunities," Espe said.

"There is little existing overlap between the businesses, and we expect the separation to create minimal incremental operating expenses and result in no disruption to our customers, distributors, and suppliers. Both businesses will remain headquartered in Lancaster and we expect minimal impact on our employees."

Following the split, Armstrong World Industries will be made up of the Armstrong Building Products, which focuses on suspended ceilings.

In 2014, Armstrong Building Products generated approximately $1.3 billion of revenue.

Armstrong Flooring will continue to specialize in flooring in both North America and Asia. The company recently got out of the flooring business in Europe.

Last year, Armstrong Flooring generated approximately $1.2 billion of revenue.

Armstrong's ceiling business generates nearly triple the profits of its flooring business.

With 3,600 employees worldwide, Armstrong Flooring will operate 17 plants in three countries including an LVT plant in Lancaster.

Don Maier, currently CEO of Armstrong Flooring Products, will serve as CEO of Armstrong Flooring.