James Hardie Industries (ASX: JHX) saw its stock price plummet by 11.20% in Monday's pre-market trading session following the announcement of its plans to acquire U.S.-based Azek Co. for $8.75 billion. The deal, described as a merger to create a leading building products growth platform, involves a combination of cash and James Hardie shares.

According to the agreement, Azek shareholders will receive $26.45 in cash and 1.0340 ordinary shares of James Hardie for each Azek share they hold. As part of this transaction, James Hardie will also list its shares on the New York Stock Exchange (NYSE), expanding its presence in the U.S. market.

While the acquisition aims to strengthen James Hardie's position in the building products industry, investors appear to be concerned about the substantial cost and potential risks associated with such a large-scale merger. The significant drop in share price suggests that the market is skeptical about the immediate benefits of the deal and may be worried about the company's financial leverage following the acquisition.