Two major manufacturers of impact-resistant doors and windows will join forces as PGT Inc. has entered into a definitive agreement to buy CGI Windows & Doors Holdings Inc. (a portfolio company of Cortec Group Fund, IV LP). CGI will become a wholly-owned subsidiary of PGT. PGT says the transaction, valued at approximately $111 million, is consistent with its plan to grow strategically while contributing to earnings growth through targeted acquisitions of complementary specialty products.
PGT says the acquisition will enhance its leadership position in the growing impact-resistant door and window industry while strengthening its ability to compete against national suppliers and other storm protection systems. It will also diversify and broaden PGT’s brand portfolio, including the addition of impact-resistant entry doors, create synergies by maximizing efficiencies and scale including purchasing and logistics, and broaden manufacturing footprint and capabilities.
“The acquisition of CGI Windows & Doors is consistent with our stated growth plan to acquire revenue generating products that leverage our core capabilities,” says Rod Hershberger, PGT chairman of the board and CEO. “More importantly, as we learned more about CGI and met with their team, it became clear that our respective missions and cultures are really well aligned. This is an ideal acquisition for PGT, and it will provide important synergies while enhancing our leadership position within the industry. I couldn’t be more thrilled as this acquisition will allow us to diversify our brand and product portfolios in a cost-effective manner. By adding top line sales and achieving synergies, we are confident this will drive growth in stockholder value.”
Subject to customary closing conditions, the transaction is expected to close next month. Deutsche Bank and Keybanc NA have committed to providing a long-term debt facility of $235 million which, together with cash on hand, will be used to consummate the acquisition, repay existing indebtedness and for general corporate purposes.
“A very exciting time for both companies, as this strategic and complementary combination will bring significant benefits to our collective customers,” says Steve Dawson, executive vice president of sales at CGI. “Our customers can expect to benefit from expanded product portfolios and increased manufacturing capabilities. In addition, our employees will have the advantage of being part of a larger organization, well positioned to meet the evolving needs of the 21st century consumer of impact-resistant windows and doors.”
After the transaction closes, CGI will continue to operate and manufacture products in Miami, and will remain a separate and distinct brand in the marketplace, according to the PGT announcement.