Woodgrain acquiring Huttig
Woodgrain Inc. has signed an agreement to acquire Huttig Building Products, Inc., the St. Louis, Mo.-based distributor of millwork, building materials, and wood products.
The deal calls for Woodgrain to acquire Huttig in an all-cash transaction valued at $10.70 per share, or approximately $350 million including the assumption of debt.
Huttig’s Board of Directors unanimously approved the acquisition, which is expected to close in the second quarter of 2022.
Last October, Huttig announced that the board was reviewing strategic business alternatives aimed at increasing shareholder value.
Huttig distributes products through 25 distribution centers serving 41 states. The company’s primary customers include building materials dealers, national buying groups, home centers, and industrial users, including manufactured home producers.
“Huttig has a long history as a value-added distributor, focused on service and innovation,” said Kelly Dame, president and CEO of Woodgrain. “This acquisition will increase our footprint by expanding our network, and by adding Huttig’s expertise and resources to our own, we are positioned to bring even more value to our respective customers and supply partners.”
With headquarters in Fruitland, Idaho, Woodgrain manufactures moldings, doors, and windows. The company operates six divisions and over 30 manufacturing and warehouse facilities in the United States and South America.
Jon Vrabely, Huttig’s President and Chief Executive Officer, said, “We are confident that the Company’s comprehensive strategic alternatives review process that was publicly announced in October 2021 has resulted in a tremendous outcome for our stockholders, associates, and customers.”
In a prepared statement issued by both companies, Vrabely noted, “The Board of Directors determined that this premium, all-cash offer would create increased value for our stockholders, while providing continued growth opportunities for our associates. We are especially pleased that we achieved a great outcome for all of our stakeholders with Woodgrain as we have enjoyed a strong partnership with them for several decades.”
For the fourth quarter 2021, Huttig reported net sales increased nearly 25% to $230.4 million. For the full year, sales increased 18.4% to $937.8 million.
Mill Road Capital, a private investment firm, attempted to acquire Huttig in 2020 and made several stock acquisition proposals to the company. At the time, Mill Road Capital was Huttig's largest shareholder.
Last year, Woodgrain acquired two millwork shops from Lowe's.
Wells Fargo is serving as an exclusive financial adviser to Woodgrain and will also serve as sole underwriter for the transaction financing. Stoel Rives is serving as legal advisor to Woodgrain on the transaction.
Lincoln International is serving as a financial advisor to Huttig. Baker McKenzie is serving as legal advisor to Huttig on the transaction.
