Ceiling fan companies in takeover battle
Two Texas manufacturers are locked in battle over an unsolicited tender offer that would merge the two companies into one. Litex Industries, of Grand Prairie, Texas, has launched a bid to purchase all the outstanding shares of common stock of Craftmade International, based in Coppell, Texas.
Both companies make or import ceiling fans and lighting fixtures. Craftmade has also expanded into outdoor furniture. The two companies are headquartered just outside of Dallas.
In its most recent letter to its shareholders, dated March 31, Craftmade recommended that they reject Litex’s offer of $5.25 a share. “Litex has engaged in an aggressive campaign to buy Craftmade at a bargain price,” said the letter, a copy of which is on file with the Securities and Exchange Commission. Craftmade accuses Litex of misrepresenting its willingness to negotiate, its financial difficulties, and its executive compensation.
In a March 31 news release, Litex refutes these claims. It accuses the Craftmade board of directors of putting its own interests before that of the company’s. Litex maintains that $5.25 is a fair per-share value, and it reiterates its tender offer, which expires on April 7.
Slower growth for global plumbing market
The global demand for plumbing products is expected to decelerate from its heady pace during the 2003-to-2008 period, when spending grew by 7.6% a year, according to a new study by the Freedonia Group. The Cleveland-based market research firm is forecasting a more modest 3.5% annual growth rate through 2013, with the highest increases in China, India, Indonesia and Vietnam.
Growth in developed countries such as the United States, Canada, Japan, Western Europe and Australia will be limited by their economic recoveries and a slower pace of building construction, the report said.
The fixtures segment of the world plumbing products market is expected to grow at a faster rate than the fittings segment through 2013. In developed countries, increasing demand for low-consumption fixtures (e.g. motion sensor faucets) and “recreational bathing fixtures” will contribute to demands, according to the study.
KB Home partners with WaterSense
Los Angeles-based home builder KB Home, in partnership with the Environmental Protection Agency’s WaterSense program, has announced it plans to be the first home builder to build new homes to meet the WaterSense specifications.
The WaterSense label is granted to homes that use 20% less water than a conventional new home and save the homeowner more than 10,000 gallons per year, according to the EPA.
KB Home said it already incorporates WaterSense bathroom faucets to its new home designs.
“KB Home is proud to collaborate with the EPA to set a benchmark standard and build consumer awareness of the benefits of water-saving features in new homes,” said Jeffrey Mezger, president and CEO of KB Home. “We believe that much like how the EPA’s Energy Star qualification has raised awareness among consumers regarding energy efficiency, the WaterSense program will heighten consumers’ sensitivity to water consumption. In addition to being earth-friendly, homes built to the EPA’s strict guidelines for energy and water efficiency help to drive down the costs associated with day-to-day living in a home, saving buyers money and natural resources.”
According to KB Home, in order to meet the criteria, home builders must incorporate a number of WaterSense-labeled features, such as shower heads, faucets and toilets, as well as using landscape designs to minimize water usage and installing energy-efficient water heating. Once the home is complete, a third-party rater ensures that the upgrades meet the WaterSense standard.