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NEW YORK (TheStreet) -- Shares of USG (USG) were gaining 6.91% to $30 in early morning trade on Monday after the building materials manufacturer said it had entered into a definitive agreement to sell its distribution unit, L&W Supply, to ABC Supply for $670 million.

USG, based in Chicago, is looking to reduce its debt with the deal, focus on its businesses with high returns like its gypsum and ceiling units and implement advanced manufacturing initiatives, according to a statement.

The all-cash sale to roofing supplier ABC Supply is expected to close by year's end.

L&W, a gypsum wallboard and building materials distributor, generated roughly 38% of USG's revenues in 2015, Reuters reports.

As of June 30, USG held about $1.68 billion in debt.

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Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

TheStreet Ratings rated this stock as a "hold" with a ratings score of C+.

The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, a generally disappointing performance in the stock itself and poor profit margins.

You can view the full analysis from the report here: USG

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