Masonite acquiring PGT Innovations
Masonite International Corporation is acquiring PGT Innovations, a manufacturer of patio door and window solutions along with impact-rated glass applications.
Terms of the deal call for Masonite to purchase the company through a combination of cash and Masonite shares with a total transaction value of $3 billion. The companies announced the deal this morning.
The acquisition calls for PGT Innovations shareholders to receive $41 per PGT Innovations share, comprised of $33.50 in cash and $7.50 in common shares of Masonite. The per-share consideration is a premium of approximately 24% to PGT Innovations’ 30-day. volume-weighted average share price.
Upon completion of the transaction, Masonite shareholders will own approximately 84% of the combined company, with PGT Innovations shareholders owning approximately 16%.
Masonite said the addition of PGT Innovations provides the door and door systems manufacturer with complementary product offerings in adjacent categories, attractive geographies, expanded routes to market, and cross-selling opportunities.
“The acquisition of PGT Innovations accelerates our strategy and is an exciting and transformational step in the nearly 100-year history of Masonite,” said Howard Heckes, President and CEO of Masonite. “The combined business will be well positioned to provide homeowners with differentiated solutions across both the interior and exterior openings of the home, while significantly expanding our geographic presence and growth opportunities.
Heckes will continue to serve as CEO of Masonite. At the closing, expected in the middle of 2024, Jeff Jackson, PGT Innovations CEO, and one additional PGT Innovations director will join the Masonite Board of Directors.
“Today’s announcement is a significant milestone for PGT Innovations, and a testament to the talent and dedication of our team members around the country,” Jackson said. “This transaction will provide significant near-term value to PGT Innovations’ shareholders, while also enabling them to participate in the long-term upside opportunity of the combined company.”
The boards of both Masonite and PGT Innovations have each unanimously approved the transaction.
Masonite intends to fund the cash portion of the merger consideration with a combination of cash on hand, borrowings under existing credit facilities, and the proceeds from new debt and/or equity financing.
The Tampa-based company has received $1.8 billion in senior secured term loan commitments and $980 million in bridge loan commitments from Jefferies Finance LLC and Sumitomo Mitsui Banking Corporation in connection with the transaction.
Jefferies LLC is serving as the exclusive financial advisor to Masonite. Wachtell, Lipton, Rosen & Katz is serving as legal counsel and Simpson Thacher & Bartlett LLP is serving as financing counsel to Masonite.
Evercore LLC is serving as the exclusive financial advisor to PGT Innovations, and Davis Polk & Wardwell LLP is serving as its legal counsel.
PGT Innovations is based in Venice, Florida.
