Nortek Inc. plans to acquire vinyl building products manufacturer Ply Gem Industries Inc. of New York in a deal valued at $482 million.
Providence, R.I.-based Nortek, which makes and distributes building and remodeling products, will pay $310 million, and assume or refinance $172 million in debt. Both companies are publicly held.
Ply Gem declined a recent offer by Atrium Acquisition Holdings Corp., a company set up by Dallas investment firm Hicks, Muse, Tate & Furst Inc.
Ply Gem had been for sale before — in the summer of 1995 —after a 1994 restructuring ended up increasing costs and causing financial problems. Although some large companies looked at the manufacturer and distributor of building products, it did not bring in any offers at that time.
Ply Gem makes wood and vinyl products. Its plastics operations are Variform Inc., a vinyl siding firm in Kearney, Mo.; vinyl window fabricators Great Lakes Window Inc. of Toledo, Ohio, and SNE Enterprises Inc. of Mosinee, Wis.; and Richwood Building Products Inc., an injection molding operation in Richwood, Ky.
Variform ranked sixth in Plastics News' recent survey of North American profile extruders, with sales of $175 million.
``The two companies complement one another,'' as both firms have emphasized remodeling and renovation markets, but with different products, said Richard L. Bready, Nortek's chairman and chief executive officer.
Bready said the merger will create a firm with about $1.7 billion in annual sales, and profit before interest and taxes of more than $155 million.
Ply Gem had 1996 annual sales of $774.9 million. Nortek reported 1996 sales of $969 million and profit of $22 million.
Nortek's existing product line includes range hoods, bathroom fixtures, bath fans, air conditioning and ventilation products, and replacement furnaces.
Nortek will pay $19.50 per share for Ply Gem's outstanding common stock, spending a total of about $310 million for the stock and to settle common stock options. Nortek will assume or refinance $172 million of existing debt.
Since Ply Gem did not go through with its deal with Atrium Acquisition Holdings, which had offered $18.75 per share, Nortek will pay Atrium a fee of about $10 million. An Atrium spokesman said that firm will continue to pursue growth through acquisitions and start-up operations.
Nortek plans to commence a cash tender offer for all outstanding shares of Ply Gem common stock by July 29.