EAGAN, Minn., NEW YORK and STAMFORD, Conn. - Affiliates of Saunders Karp & Megrue (SKM) and Trimaran Capital Partners (TCP) announced that they have entered into a definitive agreement to purchase Norcraft Companies, L.L.C. Norcraft, based in Eagan, Minnesota, is a leader in manufacturing, assembling and finishing kitchen and bathroom cabinetry in the United States. The total transaction value is approximately $315 million. Norcraft is being sold by Pfingsten Partners, L.L.C. and Goense, Bounds & Partners, LLC. Norcraft's senior management will continue in their current positions, with Mark Buller joining the company as the new CEO. Mr. Buller has over 15 years of management experience in the cabinetry industry. SKM and TCP will be investing as partners alongside senior management and Mr. Buller.
"We have been actively looking to invest in the cabinet industry for a number of years, and we believe that our partnership with Mark Buller has enabled us to invest in the premiere company in the industry, behind a world class operator" stated Chris Reilly, a partner at Saunders Karp & Megrue. "We are strong believers in the continued growth in this industry and feel that Norcraft is well positioned to continue to take market share," added Mr. Reilly.
Catalina Research Inc., an independent research and consulting firm, estimates that the kitchen and bathroom cabinetry industry in the United States has grown in excess of 6% per annum since 1987, from $4.2 billion to $10.7 billion in 2002. Demographic trends and other economic indicators continue to support future growth in the industry including continued population growth, increasing home ownership and household formations, the aging housing stock and a positive outlook for the near term growth in the US economy.
Jay Bloom, a Trimaran co-founder and managing partner, said, "We believe Norcraft represents a great opportunity to invest in a clear leader in the cabinet industry with distinctive brands, a strong management team and a track record of strong growth and increasing market share." Since 2000, Norcraft has more than doubled its sales and has transformed itself from a small, single branded manufacturer into the fifth largest manufacturer of kitchen and bathroom cabinetry in the United States according to Kitchen & Bath Business magazine.
Mark Buller grew up in the cabinet industry. In 1971, his father, Herb Buller, founded Kitchen Craft Cabinets, a Canadian cabinet manufacturer located in Manitoba, Canada. Mark Buller became President of Kitchen Craft in 1996 and sold it to Omega Cabinets in 1999. Mr.Buller stayed on as President of Kitchen Craft, was promoted to CEO of Omega in 2000 and subsequently sold the Company to Fortune Brands in 2002 for approximately $538 million. Commenting on his new role with Norcraft, Mr. Buller said, "I have been in the cabinet industry my entire career and am extremely excited about the opportunity to join the Norcraft team. Norcraft's four brands, manufacturing expertise and invaluable dealer network, provide a strong foundation to continue our growth. Norcraft's three divisional presidents have done an excellent job growing their businesses, and I look forward to joining them in this effort."
Norcraft is a leader in manufacturing, assembling and finishing kitchen and bathroom cabinetry in the United States. The Company offers a comprehensive line of high-quality cabinetry, providing customers with a single source for a broad range of products, from stock to high-end, semi-custom cabinetry in both framed and frameless construction. The Company's brands include Mid Continent Cabinetry(R), UltraCraft(R), StarMark(R) and Fieldstone(R). Norcraft markets each of its brands nationally, distributing cabinets through an extensive network of kitchen and bath dealers and distributors as well as directly to builders. The Company enjoys a highly diversified customer base and business mix, with revenues balanced across geographic region, end market (remodeling and new construction) and price point.
Saunders Karp & Megrue is a private investment firm headquartered in Stamford, CT. SKM currently manages over $1.5 billion in three private equity funds. Since its founding in 1990, SKM has completed more than 35 transactions across a variety of industries including consumer products, specialty retail and restaurants, building products and healthcare. For more information, visit www.skmequity.com.
Trimaran Capital Partners is a private asset management firm, headquartered in New York. TCP has completed 60 investments since 1995 and is investing Trimaran Fund II, which has committed capital in excess of $1 billion. For more information, visit www.trimarancapital.com.
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