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USG Corporation Completes $670 Million Sale

Chicago, Illinois, USA 31 October 2016 -- (BUSINESS WIRE) -- USG Corporation ("USG") (NYSE:USG) today completed the sale of its building products distribution business, L&W Supply Corporation ("L&W Supply"), to ABC Supply Co., Inc. ("ABC Supply") for a total cash consideration of $670 million.

The completion of this previously announced transaction will allow USG to reduce debt and achieve its target leverage ratio, while creating new opportunities to accelerate high-margin growth with advanced manufacturing initiatives in its core Gypsum and Ceilings businesses. The sale will also allow USG to continue its strong relationship with L&W Supply, one of its largest customers, while providing incremental opportunities for growth in the independent specialty dealer channel. It is expected to decrease USG's overall earnings cyclicality and will position the company to consider future capital returns to shareholders.

"It is an exciting time for all of us at USG as we look to increase investment in advanced manufacturing initiatives that will allow us to grow and commercialize new innovations to even better meet the needs of our customers," said Jennifer Scanlon, CEO-Elect of USG Corporation. "We have made tremendous progress with Our Plan to Win and move forward with a strong balance sheet and a singular focus on what we do best, which is manufacture great products. I am incredibly proud of our industry-leading USG team and look forward to seeing all we will achieve together as a result of the latest steps we've taken to strengthen our financial position."

About USG Corporation

USG Corporation is an industry leading manufacturer of building products and innovative solutions. Headquartered in Chicago, USG serves construction markets around the world through its United States Gypsum Company and USG Interiors, LLC subsidiaries and its international subsidiaries, including its USG Boral Building Products joint venture. Our wall, ceiling, flooring, sheathing and roofing products provide the solutions that enable customers to build the outstanding spaces where people live, work and play. Its USG Boral Building Products joint venture is a leading plasterboard and ceilings producer across Asia, Australasia and the Middle East. For additional information, visit www.usg.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to management's expectations about future conditions, including but not limited to, management's expectations about reducing debt, creating opportunities and flexibility, increasing investments in a manner that allows us to grow and moving forward with a clean balance sheet. Actual business, market or other conditions may differ materially from management's expectations and, accordingly, may affect our sales and profitability or other results and liquidity. Any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. Actual results may differ materially due to various other factors, including: the impact on our performance and financial results due to the disposition of L&W Supply, one of our largest customers; economic conditions, such as the levels of new home and other construction activity, employment levels, the availability of mortgage, construction and other financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates and consumer confidence; our ability to maintain or achieve price increases; our substantial indebtedness and our ability to incur substantial additional indebtedness; capital markets conditions and the availability of borrowings under our credit agreement or other financings; competitive conditions, such as price, service and product competition; certain of our customers having significant buying power; the loss of one or more major customers and our customers' ability to meet their financial obligations to us; shortages in raw materials or changes in raw material and energy costs; our ability to successfully operate the joint venture with Boral Limited, including risks that our joint venture partner, Boral Limited, may not fulfill its obligations as an investor or may take actions that are inconsistent with our objectives; volatility in the assumptions used to determine the funded status of our pension plans; our ability to protect our intellectual property and other proprietary rights; a security breach of company information; changes in laws or regulations, including environmental and safety regulations; the outcome in legal and governmental proceedings; the occurrence of an "ownership change" within the meaning of the Internal Revenue Code; the effects of acts of terrorism or war upon domestic and international economies and financial markets; and acts of God. We assume no obligation to update any forward-looking information contained in this press release. Additional information concerning these and other factors may be found in our filings with the Securities and Exchange Commission, including the "Risk Factors" in our most recent Annual Report on Form 10-K and Form 10-Q.


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