COLUMBUS - Simonton Windows is in the process of being sold to a North Carolina company, officials announced Thursday.
Fortune Brands Home & Security Inc. announced it has signed an agreement to sell Simonton Windows to Ply Gem Holdings Inc. of Cary, N.C., a leading manufacturer of exterior building products in North America, according to press releases issued Thursday.
The deal will include all assets of SimEx, a vinyl and PVC foam extrusion manufacturing operation in West Virginia.
The combined transaction is valued at approximately $130 million. The transaction's closing is subject to regulatory approval and is expected to occur in October.
The Simonton sale is expected to reduce Fortune Brands' second half 2014 earnings per share from continuing operations by 2 to 4 cents, a press release from Fortune Brands stated.
"Simonton's strength in the replace and remodel segment of the market combined with Ply Gem's strength in new construction are a natural combination," said Chris Klein, chief executive officer, Fortune Brands. "Together the companies can now offer a more comprehensive product portfolio, benefit from an expanded distribution network and have a more efficient national manufacturing platform."
The transaction combines two leading low-maintenance, energy-efficient residential window businesses under the Ply Gem umbrella, a press release from Ply Gem stated.
The deal is expected to create a more comprehensive, balanced portfolio by combining Simonton's strength in the repair and remodeling (R&R) market with Ply Gem's leadership in the new construction market; establish a stronger national residential windows platform with manufacturing scale and channel distribution advantages to serve both R&R and new construction customers; and generate opportunities for operational efficiencies to enhance customer service and propel future profitability and growth, core tenets of Ply Gem's strategic vision, according to the Ply Gem press release.
"The addition of Simonton Windows is in full alignment with our strategic growth plan and will better balance the mix of end markets that we serve while strengthening our core capabilities and contributing significantly to revenues in the future," said Gary E. Robinette, Ply Gem's president and CEO.
"A prominent brand, Simonton has consistently been ranked a leader in the J.D. Powers Window and Patio Doors Satisfaction StudySM and is known for exceptional quality and service. Simonton Windows ideally complements our existing portfolio of window products."
Ply Gem is funding the deal through a combination of cash-on-hand and new debt. After giving effect to anticipated cost savings and synergies, the acquisition is expected to be credit accretive, officials said in the press release.
Ply Gem will operate Simonton Windows as a stand-alone business unit, similar to the way the company's existing Siding and Window groups operate today, officials said. Simonton customers will continue to be serviced through its existing relationships.
"We will be very pleased to welcome the experienced Simonton management team to Ply Gem when the deal is closed," Robinette said. "We look forward to working with them and all Simonton associates in the years ahead to build and maintain the best exterior building products company in the industry."
"Simonton is a perfect fit for the Ply Gem culture, and we are confident this new addition will help us achieve synergies and competitive advantages that drive growth in top line sales and customer and shareholder value."
Officials with Ply Gem Holdings Inc. said they could not offer further details on the acquisition or the possible effects to Simonton operations in West Virginia as the deal is still pending.