Miter Brands will acquire PGT Innovations, according to a company release. The transaction will be financed in part by an equity investment from KochEquity Development LLC, the principal investment and acquisition arm of Koch Industries Inc., and a current investor in Miter. PGTI also announced that it has terminated its merger agreement with Masonite International Corp.
Miter’s transaction with PGTI is expected to close by mid-year 2024, subject to PGTI shareholder approval, regulatory approval and customary closing conditions.
A Timeline of the agreement
Oct. 2023
PGTI declined an acquisition offer from Miter Brands.
Dec. 2023
PGT declined another acquisition offer from Miter Brands.
Masonite enters into a definitive agreement with PGTI to acquire the company.
January 2024
PGTI received another, unsolicited acquisition proposal from Miter Brands.
PGTI announced that the company was considering Miter’s new proposal.
Details of the agreement
Miter Brands and PGT Innovations Inc. announced they have entered into a definitive merger agreement for Miter to acquire all outstanding shares of PGTI at a price of $42.00 per share in cash, or an enterprise value of approximately $3.1 billion.
The purchase price represents a premium of 60% over PGTI’s unaffected closing share price on Oct. 9, 2023, the last trading day prior to the public disclosure of a proposal for the acquisition of PGTI. The merger agreement has been unanimously approved by the boards of directors of both companies. The transaction will be financed in part by an equity investment from KochEquity Development LLC, the principal investment and acquisition arm of Koch Industries Inc., and a current investor in Miter.
What the company leaders say
Matt DeSoto, president and CEO of Miter Brands, says, “Miter and PGTI are fully aligned in providing world-class service and the finest products with a culture where people, performance, and customer experiences come first. Our product mix and geographic presence are highly complementary, and we look forward to delivering enhanced value to our team members, customers, suppliers and local communities. The combined company will continue its long-held commitment to innovation, service, and high-quality window and door products as we accelerate our growth trajectory. We are excited to welcome the PGTI team into our owner-operated business with family-first values.”
Jeffrey T. Jackson, PGTI president and CEO, says, “We are thrilled to have reached an agreement with Miter that maximizes value for PGTI shareholders. Since PGTI’s founding over 40 years ago, we have delivered profitable growth and created significant shareholder value by serving our customers with the high-quality window and door solutions they need. In Miter, we have found a strong partner that shares our commitment to safety, quality, and innovation. We are excited to join forces with the Miter team.”
"Koch Equity Development is excited to support the DeSoto family along with the entire Miter Brands team in building the most valued window and door brand in America with our third equity investment since 2019," says Richard Hunt, managing director at Koch Equity Development. "We are confident that Miter’s acquisition of PGTI will result in long-term value creation for all of Miter’s stakeholders and constituencies."
What Masonite says
Masonite International Corp. confirmed the termination of its previously announced definitive merger agreement to acquire PGT Innovations Inc.
This termination follows the Masonite board of directors’ decision not to submit a revised offer to acquire PGT Innovations, after being notified that the PGTI Board had determined that a revised proposal from Miter Brands submitted on Jan. 12 was a “superior proposal.” In accordance with the terms of the merger agreement, Masonite received a termination fee of $84 million.
“The decision to waive our right to increase our offer reflects our commitment to financial discipline and rigor in our strategic investments,” says Howard Heckes, president and chief executive officer of Masonite. “We remain focused on the execution of our Doors That Do More growth initiatives and the pursuit of our 2027 financial goals. I am confident in Masonite’s ability to create long-term value for our customers and our shareholders as we continue to deliver reliable supply, drive product leadership and win the sale.”
Masonite leadership will provide further details and address questions in conjunction with the company’s fourth quarter and full year 2023 earnings conference call.
