PGT Innovations Inc. (PGTI) has sold its assets for processing door glass to Cardinal Glass Industries for $28 million. At the same time, the companies announced that they’ve entered into a seven-year supply agreement in which Cardinal will supply those components to PGTI.
PGTI will retain other assets such as its window glass processing equipment, its TPS system and all production facilities, including the glass plant where the equipment sold to Cardinal has been located. This will allow PGTI to expand its window and door assembly operations to meet increasing demand. In addition, the company plans to move about 160 employees into its window and door assembly operations and other areas, which should ease employment constraints due to a tight labor market in the Venice, Fla., area.
“This is a significant, win-win opportunity for PGTI and Cardinal,” said Jeff Jackson, president of PGT Innovations. “This enhanced partnership is a strong strategic fit, leveraging the two companies’ respective strengths. We invested in glass processing capacity in 2014, a time when no other company in our industry was investing in those assets, and that investment has paid off with the sale of these assets, generating a 37 percent annualized return for our shareholders on the investment.”
Cardinal has been a key supplier for PGTI for many years. It has more than 6,000 employees with 37 locations around the United States, including one in Ocala, Fla., where it recently announced a major expansion.
“We are excited about expanding our partnership with PGT Innovations, and the opportunities we will have supplying PGT with their door glass requirements,” said Mike Wothe, president of Cardinal LG Company. “This relationship has been developing over the past 12 years and represents a powerful opportunity for Cardinal to significantly expand our presence in Florida, one of the fastest-growing markets in the nation. We look forward to our collective growth opportunities and being part of PGTI’s continued success.”