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Masonite International, a Tampa-based designer, manufacturer, marketer and distributor of interior and exterior doors and premium door systems, reiterated on Monday it is "fully committed" to the agreed acquisition of Venice-based PGT Innovations, the largest publicly traded company in the Sarasota-Bradenton region, also a window and door manufacturer.
Masonite sent out a Monday news release noting its acquisition deal with Venice-based PGT Innovations remains underway and terms are "binding."
It's a sign both Masonite and the housing supply industry see continued growth, even in premium door and window offerings.
In mid-December, Masonite agreed to pay $3 billion in a combination of cash and Masonite shares for PGT. The offer came to $41 a share — split $33.50 in cash and $7.50 of its common stock.
The offer, at the time, represented a premium of 56.5% over PGT's Oct. 9 closing price of $26.20. In the time since then, PGT stock has risen to almost $42 a share.
On Wednesday, Miter Brands, a national window and door manufacturer based north of Harrisburg, Pennsylvania, made a third bid to acquire PGT, offering $41.50 a share.
Masonite says its offer is fair "and is confident that the definitive merger agreement — a result of thorough due diligence and careful negotiation by both the Masonite and PGT boards — reflects a full and fair value for PGT and its shareholders. In addition to compelling value, Masonite’s agreement also provides a high degree of transaction certainty."
Masonite says it and PGT continue to pursue a swift path to closing. Masonite also took note of the physical proximity both publicly traded companies have to each other.
"The transaction will create a leading door and window solutions company with substantial depth and breadth and a strengthened growth and financial profile," say Masonite officials in a Monday news release. "Bringing the two companies together will establish an attractive geographic footprint, transform Masonite's scale and capabilities, drive significant operating efficiencies and deliver industry-leading growth and returns for shareholders of both companies."
Masonite also took note of some particular benefits, including an "approximately 200 basis-point increase in future revenue growth rate; approximately $100 million in "synergies" phased in over two and four years; and an increase in Masonite's earnings per share in the first full year post-close.
On the strategic front, Masonite says there will be a "customer base expansion for both Masonite and PGT across a wide geographic footprint including many high-growth metropolitan areas."
Other selling benefits include "significant cross-selling opportunities due to Masonite's wholesale distribution and big-box retail relationships and PGT's direct-to-dealer and consumer routes to market."
Masonite says the "terms of the binding agreement between Masonite and PGT Innovations remain in effect."
A potential PGT-Masonite deal would be the largest in the region's recent history. It would create a window-and-door giant at a time when home construction is behind demand. And the company would exceed $4 billion in annual revenue.
On the regional list of publicly traded companies, Masonite is ranked No. 8 in the Business Observer's 2023 Big Book of Business, while PGT is No. 16.
Masonite had 2022 revenue of $2.9 billion, up 11.35% from 2021. PGT had revenue of $1.49 billion in 2022, up 28.5% from 2021.
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