Leading News
Will PGT Innovations Sell Out? Reuters Says ‘No’
PGT Innovations Inc. (PGTI) recently announced a grant of equity to all eligible PGT Innovations team members based on each employee’s tenure. Weeks later, the company rejected an acquisition offer from Miter Brands (MI Windows and Doors, Milgard Windows and Doors) to the tune of $1.9 billion, according to Reuters. Other news sources reported a significant hike in the company’s stock value following the attempted acquisition. On the day of Reuters’ reporting, the company’s stock was valued at $26.20 per share. The following day it climbed to $31.95.
According to Reuters, PGTI’s board of directors turned down a “fully-financed $33-per-share offer,” deeming it “inadequate.”
Reuters based its reporting on “people familiar with the situation,” who are “requesting anonymity because the matter is confidential,” the article said.
When [DWM] reached out to PGTI, “as a matter of policy, PGT Innovations does not comment on rumors or speculation,” responded Stephanie Cz, the company’s corporate marketing manager.
Miter Brands failed to comment.
Regarding the grant of equity to employees, “PGT Innovations has experienced significant growth over the past four years, and we are committed to the strategy of expanding our family of brands and transforming manufacturing operations,” said Jeff Jackson, president and CEO. “Our team members are at the heart of us achieving our strong results and empowering them as shareholders provides the opportunity for them to directly share in the results of their dedication toward driving our company’s incredible performance. We have twice the number of folks on our team since the last employee stock grant in 2018, and we believe this shows how much they are appreciated and valued and that they are a part of something special here at PGT Innovations.”
The grant will require about 395,000 shares of restricted stock, which, at the time of announcement, equaled approximately $11 million in value.
Laws And Regulations
Colorado Law Leaves Much to Be Determined About Fenestration
A new law in Colorado will require all residential structures three stories or lower to use Energy Star rated products. But not all of the law’s details are as clear as most windows. “The law does not specify what Energy Star version applies,” Jeremy Neustifter, air quality policy director at the Colorado Department of Public Health and Environment, told [DWM]. Many presume that the legislative intent includes applying the standards associated with Energy Star’s latest version (7.0), but additional clarifications are needed from the Attorney General’s office, Neustifter suggested.
The Appliance Standards Bill was signed into law on June 1 and is set to take effect in January 2026. While the law’s broad intent includes improving water efficiency among a range of appliances and fixtures, legislation was expanded to include other products used in residential buildings, such as doors, windows and skylights.
At the same time, “the bill does prescribe ways in which a manufacturer could circumvent the process of Energy Star certification, so long as there is an approved test method to show that a product meets the same requirements,” Neustifter told [DWM].
Regarding the idea for countering the new law before it takes effect, Neustifter suggested that any such effort could be extremely challenging.
Department of Labor Proposes Change to Overtime Regulations
A proposed rulemaking by the U.S. Department of Labor (DOL) to raise the current salary threshold for overtime exemptions from $35,568 to $55,068 annually was published in The Federal Register. Should the change be enacted, the move will mark a 55% increase in the annual earnings threshold, extending guaranteed overtime pay to around 3.6 million salaried workers. As a result, all employees earning less than $1,059 per week would be entitled to overtime pay, regardless of job title and duties.
DOL’s proposal follows through on an announcement made in 2022, in which officials said they intended to update regulations, redefining which employees are eligible for overtime compensation and which are exempt.
The proposed rule would also change exemptions by raising the maximum salary for those classified as “highly compensated employees” from $107,432 to $143,988—the latter of which marks the 85th percentile of full-time salaried workers nationally.
Federal overtime provisions are part of the Fair Labor Standards Act (FLSA), requiring that employees covered by the Act receive overtime pay for hours worked over 40 in a workweek “at a rate not less than time and one-half their regular rates of pay.”
The proposed salary level would help ensure that salaried workers receive overtime protections traditionally provided by the department’s rules, DOL officials said.
Judges in Arizona Rule COVID-19 Can Fall Under Workers Comp
A three-judge panel sided with the widow of an employee of Western Millwork who died of COVID-19, ruling that “death or injury from COVID-19 is compensable where the statutory requirements for workers’ compensation are met.”
The judges upheld a ruling that Kenneth Zerby’s case of COVID-19 could be traced back to his workplace with a reasonable amount of certainty, given the information available at the time. Western Millwork and its insurer, Cincinnati Insurance Co., argued that by the time Zerby contracted the virus, it was so widespread that he could have contracted it elsewhere, including during activities during his personal time.
Per a judge’s opinion filed on September 21, “contracting COVID-19—like pneumonia, Lyme disease, allergies, and hepatitis—can constitute an ‘accident’ under the workers’ compensation statute, even if COVID-19 does not qualify as an occupational disease.” In support of their opinion, they pointed to a case from 1968, Montgomery v. Industrial Commission, in which the claimant was able to demonstrate that his employment subjected him to an increased risk of contracting Lyme disease.
When Diane Zerby filed a workers’ compensation claim, Western Millwork and Cincinnati Insurance Co. denied it. In turn, she requested a hearing with an Administrative Law Judge (ALJ), during which a medical expert testified that Zerby “likely contracted COVID-19 from an infected co-worker during a conversation on October 12, 2020.”
Judges collectively pointed out that no one was arguing that COVID-19 is an “occupational disease,” which would be covered by workers’ compensation, and doesn’t represent “the ordinary diseases to which the general public is exposed,” which would not be covered. Though “the legislature has enacted statutory provisions governing workers’ compensation claims for specific communicable diseases,” the judges opined that COVID-19 had not been addressed by the state legislature yet, “leaving A.R.S. § 23-1021 to supply the governing standard.” For Diane Zerby to obtain compensation, her husband must have been injured or killed by an “accident arising out of and in the course of his employment,” which the judges identified as “the statutory phrase at the crux of this case.”
SEC Updates Cybersecurity Rules for Publicly Traded Companies
Publicly traded door and window companies must disclose any cybersecurity incident considered material and describe the event in a new form within four days of the incident, according to a new rule issued by the U.S. Securities and Exchange Commission (SEC).
SEC officials say companies must also periodically disclose their cybersecurity risk management, strategy and governance in annual reports. Officials add the new rules are intended to enhance accountability and transparency.
While many publicly traded companies already disclose cybersecurity crimes to investors, SEC chairman Gary Gensler says businesses and investors will benefit from more consistency and promptness.
“Whether a company loses a factory in a fire—or millions of files in a cybersecurity incident—it may be material to investors,” explains Gensler. “Currently, many public companies provide cybersecurity disclosure to investors. I think companies and investors alike would benefit if this disclosure were made in a more consistent, comparable and decision-useful way.”
The latest regulations will mandate companies disclose any cybersecurity incident they deem material on the new Item 1.05 of Form 8-K. They will be required to outline the essential characteristics encompassing the incident, scope and timing, as well as its material impact or likely material impact.
According to experts, the most important takeaway from the new rule is that companies will now need to create written records detailing their cybersecurity programs.
Virginia Contractors Could Become Liable for Sales Tax on Installations
Virginia contractors who sell and install specific personal property, such as doors and windows, would be categorized as final consumers of the property, according to a revised rule introduced by Virginia’s tax department.
Outlined in a proposed fast-track rule amendment, published in the Virginia Register of Regulations, the Department of Taxation (DOT) states that contractors would be deemed the final users of items, such as doors, windows, fences, cabinets and other property. Unless otherwise noted, DOT officials say that contractors would be liable for applicable sales and use taxes when the items become part of real property.
Trade
Aluminum Extruders File Petition in ‘Fight for Our Very Existence’
The Aluminum Extruders Coalition (AEC) and United Steelworkers (USW) filed a trade case with the U.S. Department of Commerce and the U.S. International Trade Commission, in what AEC officials are calling “a fight for [its] very existence.” The case includes allegations of illegal and unfair dumping against 15 countries. By using “highly dumped and subsidized prices,” foreign producers of aluminum extrusions have gained a “significant and increasing share of the U.S. market at the direct expense of the U.S. industry,” AEC officials allege. They’re concerned about a rising threat of low-cost products and increased imports into the U.S. market.
Among the countries cited in the case are China, Colombia, the Dominican Republic, Ecuador, India, Indonesia, Italy, Malaysia, Mexico, South Korea, Taiwan, Thailand, Turkey, the United Arab Emirates and Vietnam. Producers of aluminum extrusions in those countries are selling extrusions in the U.S. market at less than fair value, dumping at rates of up to 256%, AEC and USW officials allege, which they say “distorts” the domestic market.
Commerce will determine whether to initiate investigations within 20 days of the filing. USITC will reach a preliminary determination of material injury or threat of material injury within 45 days.
Expansions
Tecnoglass Digs Deeper Into U.S. Market by Investing $25 Million Into Vinyl Products
Tecnoglass will begin manufacturing and selling vinyl windows (having previously offered only aluminum). The company expects to begin shipping vinyl products by the end of November 2023, selling through existing dealers and distributors. Officials for the Miami-based company said the move will more than double its market potential.
Vinyl products will be manufactured at the company’s facilities in Colombia, then imported into the U.S., Tecnoglass CEO José Daes told [DWM]. The company has signed a long-term supply agreement to procure vinyl profiles from a global manufacturer, which it will use to produce custom-sized products with its own insulating glass.
In August, Tecnoglass announced the relocation of its headquarters from Barranquilla, Colombia, to one of its existing facilities in Miami.
Press Glass Expands Its Virginia Facility
Glass fabricator Press Glass Inc. will invest $155 million to expand its existing facility in Ridgeway, Va. Officials say the expansion includes a 360,000-square-foot addition, where it will create 335 new jobs.
Press Glass opened its Virginia facility in 2020, employing more than 300 workers.
Founded in 1991, the company has 15 factories in the U.S. and Europe, where it is the largest independent processor of flat glass. It specializes in processing glass for doors and windows, facades and interior glass construction.
The Virginia Economic Development Partnership worked with the Martinsville-Henry County Economic Development Corp. to secure the project for Virginia. Gov. Glenn Youngkin approved a $2 million grant from the Commonwealth’s Opportunity Fund to assist Henry County with the project.
Boise Cascade Plans New Door Shop in Commerce City, Colo.
Boise Cascade Company says it will add a door shop in Commerce City, Colo., a suburb of Denver. The 127,000-square-foot millwork facility is scheduled to be completed in the fourth quarter of 2023 and is expected to begin production shortly after the start of 2024.
“We are excited that this new facility will allow us to expand our offering of pre-hung doors and other millwork products in one of the country’s fastest growing markets,” said Bud Skinner, millwork business development manager.
M&A
Boise Cascade Acquires Brockway-Smith
Boise Cascade Company recently completed the acquisition of Brockway-Smith Company (BROSCO), a deal first announced in August 2023. The purchase price for BROSCO, including the acquisition of its two full-scale distribution centers, was $172 million, subject to certain closing adjustments. Officials for Boise Cascade said the company funded the transaction and closing-related expenses from existing cash balances.
ASSA’s Acquisition Streak Continues With Forte
ASSA ABLOY has acquired Forte, a residential door locks manufacturer in Peru. The acquisition marks ASSA’s ninth in recent years, most recently including Spectrum Brands’ Hardware and Home Improvement division (HHI) in June. Forte was founded in 1967 and has some 340 employees. The main office and factory are located in Lima, Peru.
According to company officials, Forte is a well-known and recognized brand in Peru.
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