CPG International Inc. announced Monday that it entered into a definitive agreement to be acquired by funds managed by Ares Management LLC and Ontario Teachers' Pension Plan (Teachers).
The seller is New York-based private equity firm AEA Investors LP, which bought CPG in May 2005. Senior management of the Scranton, Pa.-based manufacturer will retain a minority stake. Terms of the transaction were not disclosed.
A May story from Reuters had said that AEA expected to sell CPG for between $1 billion and $1.5 billion.
CPG International makes low-maintenance building materials designed to replace wood, metal and other traditional materials. Products include trim, molding and decks, shower stalls, lockers and playground equipment.
Key plastics brands include Azek Building Products and TimberTech wood-plastic decking.
When AEA bought CPG, the business had sales of about $220 million and its residential building products line consisted only of Azek trim. During the past eight years, despite the housing downturn, CPG made five acquisitions and invested approximately $55 million for capacity expansion. The company now has sales of more than $500 million.
"We are excited to partner with Ares and Teachers as they share our vision for continued growth at CPG. We have enjoyed a strong relationship with AEA in building the business and thank them for all of their support," Eric Jungbluth, CEO of CPG International, said in a release.
Earlier this year CPG announced plans to consolidate its TimberTech factories into a single large wood-plastic decking plant in Wilmington, Ohio. As a result, the company plans to close its Columbus, Ohio, decking operation. CPG also is closing a plant in Toronto that makes Azek railing.
