Masonite shareholders sue to block $3.9 billion acquisition deal with Owens Corning

Masonite headquarters.

The acquisition saga involving Masonite Inc. took another turn when shareholders filed multiple lawsuits in an effort to halt the $3.9 billion deal that would see Owens Corning acquire Masonite.

Separate lawsuits on April 5 and on April 12, allege that members of the board of directors provided incomplete and misleading information concerning the company’s financial projections and stated there were conflicts of interest by financial advisors and company insiders, according to a Masonite proxy statement filed April 16 with the Securities and Exchange Commission. In addition, as of April 15, 2024, Masonite received nine demand letters on behalf of purported Masonite shareholders alleging similar deficiencies.

 The Complaints seek, among other relief, declaratory relief, an injunction enjoining defendants from consummating the proposed transaction until Masonite implements a procedure or process to comply with defendants’ fiduciary duties, enjoining or unwinding the proposed transaction unless Masonite issues allegedly corrective disclosures, rescission of the proposed transaction in the event it is consummated, compensatory and/or rescissory damages, and an award of costs including attorneys’ and experts’ fees. 

A Masonite spokesperson declined to comment because of the pending litigation and directed Woodworking Network to the proxy statement. 

In the proxy statement, the company said that it believes that the disclosures outlined in the preliminary statement and the subsequent proxy statement comply fully with all applicable laws and denies the allegations in the complaints and demand letters. The company generated the statement with supplemental disclosures that included statements supporting the projections developed by Goldman Sachs and explained the process by which these projections were developed. 

The deal, announced Feb. 9, involved Owens Corning acquiring all outstanding shares of Masonite for $133 per share in cash. The offer represents an approximate 38% premium to Masonite’s closing share price on February 8, 2024, and an approximate 46% premium to Masonite’s 20-day volume-weighted average price. The total asking price equated to $3.9 billion.

The boards of directors for both Owens and Masonite unanimously approved the transaction, which was expected to close in mid-2024. A special meeting for Masonite stockholders to vote on the proposed transaction is currently scheduled for April 25, 2024.

This was just the latest twist to the deal Masonite, in early January, was on the brink of a $3 billion acquisition of PGT  Innovations, Inc., when a better offer from Miter Brands usurped the announced deal. That deal was valued at $3.1 billion.

Founded in 1925, Masonite  (FDMC300 #8, $2.9 billion) designs, manufactures, and markets doors and door systems, with a vertically integrated manufacturing model serving both repair and remodel and new construction demand.

Masonite operates 64 manufacturing and distribution facilities, primarily in North America, and has over 10,000 employees globally.


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Larry Adams | Editor

Larry Adams is a Chicago-based writer and editor who writes about how things get done. A former wire service and community newspaper reporter, Larry is an award-winning writer with more than three decades of experience. In addition to writing about woodworking, he has covered science, metrology, metalworking, industrial design, quality control, imaging, Swiss and micromanufacturing . He was previously a Tabbie Award winner for his coverage of nano-based coatings technology for the automotive industry. Larry volunteers for the historic preservation group, the Kalo Foundation/Ianelli Studios, and the science-based group, Chicago Council on Science and Technology (C2ST).