What’s News January/February 2021August 18th, 2021 by Nathan Hobbs
In M&As Analysts See Signs of Strength
Mergers and acquisitions managed to persist across the door, window and millwork industries in the final quarter of 2020, despite COVID-19. Those activities, combined with persistent demand for residential building products, now have some analysts eyeing the sector for its long-term viability.
In November, independent investment banking firm Capstone Headwaters pointed to steady improvement for M&As among building-product-related companies, with activities rising over 100% from second- to third-quarter 2020. Those results followed a “near pause” in the second quarter, the firm’s analysts said.
Among the M&As referenced as notable were The Home Depot’s recquisition of HD Supply and the merger of Builders FirstSource with BMC Stock Holdings. In the first days of December, BMC followed with another announcement, this time acquiring TW Perry, an independent building materials distributor serving Northern Virginia, Maryland, and D.C. area.
Other deals referenced by Capstone analysts included the acquisition of Quincaillerie Lion, a distributor of door and window hardware, by Richelieu Hardware. According to Capstone’s recent reporting, Richelieu recorded “heightened sales increases in Q3 , with revenue rising 15.6% year over year, supported by strong demand in the renovation market …” The firm also cites the acquisition of door and window dealer Paradise Home Improvement in September, suggesting that private equity “has also demonstrated sustained appetite in the subsector.”
Since the release of Capstone’s report, additional M&As have taken place.
In November, US LBM acquired Zeeland Lumber and Supply in Zeeland, Mich., a company that participates in doors, windows and trim. Then, in early December, specialty building materials distributor US LBM added another acquisition to its list, picking up Ridgefield Supply Company, a building products dealer located in Ridgefield, Conn. Among the many products Ridgefield offers are windows and millwork.
In mid-December—just a month after announcing the deal—Fortune Brands Home and Security Inc. (parent company to Therma-Tru) acquired Larson Manufacturing, a manufacturer of storm doors, screens and security doors, making the company part of its Outdoors and Security segment. Around the same time, Hardwoods Distribution Inc. (HDI) announced that its subsidiary Rugby Holdings had purchased River City Millwork Inc. in Rockford, Ill., a wholesale distributor of interior and exterior doors and custom millwork with estimated annual sales of $14 million.
Other activities within millwork include the acquisitions of Pacific MDF Products Inc. and Canadian MDF Products Company, collectively known as Pac Trim, by Metrie, a North American-based manufacturer and distributor of interior millwork.
MI Windows and Doors also finalized the acquisition of Temperance, Mich.-based vinyl replacement window manufacturer Sunrise Windows and Doors. The acquisition was MI’s second in just over a year, including Milgard Windows and Doors in November in 2019.
Home Depot Settles With States Over Data Breach
A years-long investigation into a security breach exposing the personal information of 40 million customers is set to finally end for home improvement retailer The Home Depot Inc. The Atlanta-based company reached a multi-stage agreement, through which it will compensate 46 states and the District of Columbia with a total of $17.5 million. The incident occurred in 2014, when hackers gained access to the retailer’s network, deploying malware on a self-checkout, point-of-sale system, allowing access to payment card information. The company agreed to implement a series of practices and improvements designed to bolster its information security, which, according to the terms of the agreement, must be implemented within 180 days after December 21, 2020.
OSHA Addressing an Increase in Citations Related to COVID-19
As the number of COVID-19 cases in the U.S. continues to rise so, too, have the number of citations issued by the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) related to the virus. From the beginning of the pandemic through November 12, OSHA issued 232 citations with $3,148,452 in penalties—many the result of complaints, referrals and fatalities.
In the final weeks of the year, the administration issued new guidance to help employers understand which standards are most frequently cited. Among those most frequently violated are such things as providing medical evaluations before workers are fit-tested or use respirators; performing an appropriate fit test for workers using tight-fitting respirators; assessing the workplace to determine if COVID-19 hazards are present, or likely to be present, which will require the use of a respirator and/or other personal protective equipment (PPE); and establishing, implementing and updating a written respiratory protection program with required worksite-specific procedures.
Employers also frequently failed to train workers to safely use respirators and/or other PPE in the workplace, and to retrain workers about changes in the workplace that might make previous training obsolete
Points of Interest
Author Rolls Marketing Into Storytime for Kids
In an interesting twist that comingles marketing with story time, Irish children’s book writer Emer Conlon created a new book based on the product portfolio of Combilift. The book, “The Forklift Trucks and Their Secret Superpowers,” launched on November 24, highlighting the Monaghan, Ireland-based company’s material handling equipment. The concept for embedding adult-aimed promotional messages into pre-K literature was the brainchild of Conlon, who’s known for her Vroom-Town series of books featuring anthropomorphic vehicles.
“The idea was to write a children’s book which ‘cartoon-izes’ the main Combilift products and transforms them into characters that children will love,” Conlon said in a press release about the new book. “I wanted to also use it as a marketing tool for the adults and so I used the USPs of the actual forklifts and turned them into the superpowers of the characters!”
The book takes on the topics of overcoming difficulties, the importance of friendship and that bullying is unacceptable. The moral, ultimately, is that no matter what someone looks like or what shape or size they are, it is important to be accepting of others and of differences.
Window World Franchise Expands in Rio Grande Valley
Replacement window and exterior remodeling company Window World recently opened a new location in the Rio Grande Valley area of Texas. The new store is the 14th franchise location in the Lone Star State, officials said, with more planned in the near future. Based out of North Wilkesboro, N.C., the franchise has more than 200 locations across the country.
Franchise owner Gabe Cortez was born and raised in the Rio Grande Valley. Beyond Window World, Cortez has an extensive background in the franchising industry, having worked in high-level marketing positions for notable restaurant brands.
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