Private investment group Clayton, Dubilier & Rice is creating a $2.4 billion exterior building products company by buying both Ply Gem Holdings Inc. and Atrium Windows & Doors.
CD&R will acquire all outstanding shares of Ply Gem in a transaction announced Jan. 31, which will move the window company into private hands. The deal gives $21.64 per share in cash to all holders of common stock, which is about 20 percent more than the closing stock price on Jan. 30.
“This is a transformational milestone for two highly complementary businesses,” Nate Sleeper, a CD&R partner, said in a Jan. 31 news release. “Together, Ply Gem and Atrium have a well-positioned platform across North America, a deep set of capabilities to serve customers, and a strong foundation for long-term growth and value creation.”
Based in Cary, N.C., Ply Gem already was the top building products manufacturer — as well as the second largest extruder — in North America with estimated sales of $1.5 billion, according to Plastics News' latest ranking.
Ply Gem produces a variety of siding, windows, patio doors, cellular PVC trim and moldings, roofing, vinyl fences and rails. The company, which has about 8,500 employees at some 60 facilities, says it is No. 1 in vinyl siding sales in North America as well as vinyl and aluminum window sales in the U.S. for the new construction and remodeling markets.
Established in 1948 and based in Welcome, N.C., since 1994, Atrium's website says it has manufacturing operations for vinyl and aluminum doors and windows at its main campus as well as sites in Dallas and London, Ontario. Sales in 2017 generated about $350 million, according to the release.
CD&R's acquisitions are expected to close simultaneously in the second quarter of 2018. Then, the firm with offices in New York and London will own about 70 percent of the new privately held Ply Gem company. Atrium shareholders, including funds managed by Golden Gate Capital, will hold about 30 percent.
The new Ply Gem will keep its Cary headquarters and Gary Robinette will continue as chairman and CEO. John Krenicki, a CD&R operating partner and former vice chairman of General Electric Co., will be lead director of the board.
Ply Gem's board of directors unanimously approved the transaction.
Atrium CEO Ron Cauchi said in the news release that long-term growth prospects look good, and that he expects “synergies that will be achieved through an enhanced product breadth and stronger North American platform.”
The Ply Gem closing is not subject to the Atrium acquisition.
Founded in 1978, CD&R has managed the investment of $25 billion in 77 companies with an aggregate transaction value of more than $100 billion.