HOUSTON - Quanex Building Products Corp. is acquiring cabinetry components maker Woodcraft Industries for $248.5 million in cash. The transaction by Quanex, a window and door components manufacturer, is expected to close in the fourth quarter.
The privately-held Woodcraft manufactures kitchen and bath cabinet doors and components, with13 production facilities and four distribution locations throughout the United States, Canada, and Mexico. Quanex (NYSE: NX) said it expects Woodcraft to add $240 million in annual revenues Quanex's portfolio of building products.
Woodcraft's current management team, led by President Dale Herbst, will continue to operate the components manufacturer from its St. Cloud, Minnesota, headquarters as a wholly-owned subsidiary of Quanex.
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Quanex Chairman, CEO and President Bill Griffiths said, "Quanex's growth strategy is based, in part, on highly-complementary acquisitions that contribute proven technologies, products and enhanced scale. Woodcraft is an ideal strategic and financial fit in this regard. It is, first and foremost, a well-run company that adds $3 billion to our addressable market. Woodcraft's breadth of products and stellar customer relationships are unmatched in the industry and also represent uniquely positive and durable attributes. Woodcraft's business model is also very similar to our operations in that they serve large OEM customers. Finally, we expect the acquisition will deliver clear financial benefits to Quanex shareholders as we continue to prudently build the company for sustained profitability."
Herbst added, "Upon closing, the transaction will represent the best of both worlds: a continuation of Woodcraft's craftsmanship and unrelenting customer focus combined with access to Quanex's resources in pursuit of new opportunities in the growing cabinet industry. More generally, it was important that we align with an organization that shares our values and that is committed to expanded opportunities for our employees and service excellence for our customers. Quanex is an ideal partner for us moving forward, and we look forward to a bright future together."
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