SOURCE: Brown Gibbons Lang & Company LLC

Brown Gibbons Lang & Company

June 23, 2015 07:00 ET

Window of Opportunity in Building Products

Mergers & Acquisitions Activity Accelerates in the Building Products Industry

CLEVELAND, OH and CHICAGO, IL--(Marketwired - June 23, 2015) - Building products is seeing M&A activity accelerate on the heels of improving market fundamentals, according to the Industrials Insider, an industry report released by Brown Gibbons Lang & Company (BGL) www.bglco.com. Growing investor appetite is broad-based, spanning both residential and commercial construction end markets.

The fragmented window and door industry is among the sectors seeing a healthy uptick as participants seek consolidation opportunities to expand manufacturing footprints and capabilities, broaden product portfolios, and enhance margins. Several acquisitions involving corporate and private equity acquirers have been announced during the last 12 months, indicative of an active deal market and likely harbingers of continued consolidation:

  • Ply Gem Holdings' acquisition of Simonton Windows from Fortune Brands Home & Security broadens the company's national manufacturing platform and establishes a stronger position in the repair and remodeling market. The deal aligns with Ply Gem's strategy of acquisitive growth, following the 2013 acquisition of Gienow which solidified the leading market position in Canada.
  • PGT's acquisition of CGI Windows and Doors marks the largest acquisition in the company's 35-year history. The purchase of the regionally-focused maker of impact resistant windows and doors underscores a bullish outlook on a sustained recovery of the Florida housing market.
  • Both deals involved established brands and were transacted at full multiples, reflective of growing investor confidence in continued economic growth and a strengthening recovery in the construction market.
  • Private equity is adding platforms in the space; among the active funds are Altus Capital Partners (GED Integrated Solutions), Nautic Partners (Custom Window Systems), and Audax Group (Chase Doors).

BGL publishes periodic research reports on a variety of industries including automotive; building products and construction materials; business services; consumer products and retail services; environmental and energy services; healthcare and life sciences; human capital management outsourcing; industrials; metals; and plastics and packaging. Download BGL Insider reports at bglco.com.

Attachment Available: http://www.marketwire.com/library/MwGo/2015/6/22/11G045520/BGL_Industrials_Insider_Jun_15-55499054719.pdf

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