Masco sells window and door division for $725 million
October 1, 2019 | 10:48 am CDT
LIVONIA, Mich. - The parent of Kraftmaid, Merillat, Masco Cabinetry, and Cardell Cabinetry, Masco Corporation (NYSE: MAS), has confirmed the sale of its Milgard Windows and Doors division to MI Windows and Doors for $725 million.
The agreement contains customary representations, warranties and covenants. The closing of the sale is expected to occur during the fourth quarter of 2019, subject to customary closing conditions and regulatory review.
With headquarters in Tacoma, Washington, Milgard is one of the nation's biggest window makers - employing 3,000 across manufacturing and service plants in Portland, Oregon; Sacramento, Simi Valley and Temecula, California; Denver, Colorado; and Dallas/Fort Worth, Texas. MI Windows and Doors is one of the nation's largest suppliers of vinyl and aluminum windows and patio doors.
“Since we announced the strategic review of our cabinetry and windows businesses in March, we have worked with our external advisors, our cabinetry and windows business units, and our Board of Directors to evaluate alternatives to best deliver long-term value for our shareholders,” said Keith Allman, Masco’s president and CEO. “We have determined that pursuing the sale of Masco Cabinetry, Milgard Windows and UK Window Group in three separate transactions is the most appropriate path forward to accomplish this value creation. We expect that the sales of these businesses will be concluded in approximately six to nine months, assuming that each of these transactions can be completed on acceptable terms and conditions.”
The businesses on the block totaled $1.7 billion in revenue last year. For 2018, Masco reported net sales of its Cabinetry Products segment of $950 million, and operating profit of $86 million. The company is the third biggest cabinetmaker on the FDMC 300.
Masco said its decision results from wanting to minimize its exposure to the new construction market. The company hopes to zero in on its "less cyclical" plumbing and decorative architectural products businesses, Allman said.
Masco is ranked #3 among top North American cabinetry producers, and #15 overall, among the FDMC 300 list of top North American wood products producers. Headquartered in Ann Arbor, Michigan, Masco Cabinetry manufactures and sells semi-custom, stock and value-priced assembled cabinetry for kitchen, bath, storage, home office and home entertainment applications in a range of styles and price points. Masco Cabinetry’s KraftMaid and Cardell products are sold primarily to dealers and home center retailers, and its Merillat and Quality Cabinets products are sold primarily to dealers and homebuilders for both home improvement and new home construction.
Masco’s two window businesses are Milgard Windows and Doors, headquartered in Tacoma, Washington, and UK Window Group, headquartered in Wales in the United Kingdom. Milgard manufactures and sells vinyl, fiberglass and aluminum windows and patio doors under the MILGARD brand name for home improvement and new home construction, principally in the western United States.
The UK Window Group manufactures and sells vinyl windows, composite doors, related products and components under several brand names, including Duraflex and Griffin. For 2018, Masco reported net sales of its Windows and Other Specialty Products segment of $755 million, operating profit of $34 million.
Headquartered in Livonia, Michigan, Masco Corp. is a global leader in the design, manufacture and distribution of branded home improvement and building products. Its portfolio of industry-leading brands includes Behr paint; Delta and Hansgrohe faucets, bath and shower fixtures; KraftMaid and Merillat cabinets; Milgard windows and doors; Kichler decorative and outdoor lighting; and HotSpring spas. www.masco.com.
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