Masonite To Buy PGT Innovations In $3 Bln Cash, Stock Deal
Masonite International Corp. (DOOR), a manufacturer of interior and exterior doors and premium door systems, announced Monday a definitive agreement to acquire PGT Innovations, Inc. (PGTI), a manufacturer of patio door and premium window solutions. The deal is for a combination of cash and Masonite shares with a total transaction value of $3 billion.
In pre-market activity on the NYSE, PGT shares were gaining around 8.1 percent to trade at $39, while Masonite shares were losing around 2 percent at $100.
Under the deal terms, PGT Innovations shareholders will receive $41 per each share they own, comprised of $33.50 in cash and $7.50 in shares of Masonite.
The per share consideration represents a premium of around 24 percent to PGT Innovations’ 30-day volume weighted average share price.
The deal is currently anticipated to close in the middle of 2024 subject to approval by the PGT Innovations shareholders, as well as the receipt of required regulatory approvals, and satisfaction of other customary closing conditions.
Upon completion of the deal, Masonite shareholders will own around 84 percent of the combined company, with PGT Innovations shareholders owning around 16 percent.
The transaction is expected to be accretive to Masonite’s EPS in the first full year of ownership and accelerate thereafter with the realization of synergies.
On a pro forma basis, for the last twelve months ended October 1, the combined company had over $4 billion in revenue, and around $700 million of adjusted EBITDA.
Masonite expects to realize approximately $100 million in annual synergies phased in over the next several years following the deal closure.
Following the deal closure, Howard Heckes will continue to serve as CEO of Masonite, while Jeff Jackson, PGT Innovations CEO, and one additional PGT Innovations director will join the Masonite Board of Directors.
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.
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