Merger opens new door at Ply Gem
Cary-based Ply Gem sells about $2 billion of vinyl siding, windows and other products annually, so it seems the company would thrive in a strong economy for home construction and remodeling. It hasn’t worked out that way for long-term investors: The company went public in May 2013 at $21 a share, and now New York-based Clayton Dubilier & Rice plans to acquire it for $2.4 billion, or $21.64 per share. At the same time, the private-equity group is also buying Welcome-based Atrium Windows & Doors, which posted sales of $375 million last year and employs about 1,000 at its Davidson County site.
Ply Gem and Atrium, which is controlled by Golden Gate Capital of San Francisco, will be combined pending completion of a merger — unless the deal falls through. The New York Post reported in early February that San Francisco-based private-equity company Hellman & Friedman is weighing a higher bid for Ply Gem. At press time, shares traded for more than $21.64.
Two-thirds of Ply Gem’s shares are controlled by New York private-equity investor Fred Iseman, founder of CI Capital Partners. He bought Ply Gem for $570 million in 2004 and later invested hundreds of millions of additional dollars to shore up its capital and add several building-supply companies. The Post reported in early 2017 that he was shopping the company with a price tag of $2 billion, including debt.
Clayton Dubilier’s plans call for Ply Gem CEO Gary Robinette to retain his post, which he assumed in 2006. His total compensation for the last three years topped $11 million. Veteran Raleigh CPA Jeff Barber is a Ply Gem director.
Golden Gate Capital bought control of Atrium in 2010, shortly after the company filed for protection from creditors in federal bankruptcy court. It and other Atrium investors will own about 30% of the combined company.
Ply Gem reported net losses of about $150 million from 2012-14 but has rebounded with three consecutive profitable years. Its share price has increased 56% during that same period.
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