Platinum Acquires Cabinetworks from AIP and GIC

Platinum Equity has agreed to acquire The Cabinetworks Group from American Industrial Partners and GIC.

Ann Arbor, Michigan-based Cabinetworks is a manufacturer and distributor of both framed and frameless, kitchen and bath cabinets. The company operates 14 assembly plants and 3 component facilities and sells its products through dealers, home centers and distributors.

Cabinetworks sells its products under 19 brand names including KraftMaid, Medallion, Smart, Merillat, Yorktowne, Echelon, Advanta, Studio Full Access, Master WoodCraft, and Cabinets 2000.

Cabinetworks (formerly ACProducts) was formed by American Industrial Partners in October 2012 to acquire the cabinets business of Armstrong World Industries. In November 2018, the company acquired Elkay Wood Products from privately-held Elkay Manufacturing Company. The combination of ACProducts and Elkay created a company with more than $500 million in revenue. In February 2020, ACProducts acquired Masco Cabinetry for $1 billion and the combined business, with annual revenues of more than $1.8 billion, was renamed Cabinetworks with Joe Gross, the CEO of Masco Cabinetry, leading the business.

“Cabinetworks has a comprehensive portfolio of highly-respected, fast-growing brands, a strong leadership team and a proven track record for growth,” said Jacob Kotzubei, a partner at Platinum. “The company’s leading position in the cabinets space, combined with Platinum’s operational toolkit and M&A resources, make Cabinetworks a great fit for our portfolio.”

“We are thrilled to partner with Joe and the entire Cabinetworks team,” said Todd Golditch, a managing director at Platinum. “They have built an attractive platform and helped transform the industry, and there is also a significant amount we can do together to continue their history of innovation and grow the business both organically and through additional M&A activity.”

Platinum has invested in the building products sector before through the March 2017 acquisition of Interior Logic Group, a national provider of outsourced design and installation services to homebuilders and multi-family property owners, from MSouth Equity Partners; and the May 2015 buy of PrimeSource, a national distributor of construction fasteners and other non-lumber building products to the new construction and remodeling markets, from Tokyo-based multinational ITOCHU Corporation.

“Platinum has had a lot of success in the building products sector, we know the industry well and are excited about the opportunities ahead for Cabinetworks,” added Mr. Golditch.

Platinum Equity invests in a range of industries including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, and telecommunications. The firm is currently investing from Platinum Equity Capital Partners V LP, a $10 billion buyout fund, and Platinum Equity Small Cap Fund LP, a $1.5 billion buyout fund focused on the lower middle market. The firm has completed more than 300 acquisitions since its founding in 1995 and is headquartered in Beverly Hills.

American Industrial Partners (AIP) makes equity and debt investments in manufacturing and industrial services companies that have revenues of at least $300 million, negative EBITDA to $250 million, and enterprise values of up to $2 billion. The firm was founded in 1989 and is headquartered in New York City.

“We have been honored to work with a best-in-class management team and a remarkable and dedicated workforce across the United States to build an industry-leading kitchen and bath cabinetry business,” said Rick Hoffman, a partner at AIP. “We are proud of what Cabinetworks has accomplished during our partnership over the last eight years and believe the company is now positioned for still greater success in the years to come.”

GIC, AIP’s co-investor in Cabinetworks, was founded in 1981 to manage Singapore’s foreign reserves and to invest in private equity funds as well as directly in companies. GIC is headquartered in Singapore with a network of offices in ten cities worldwide.

BofA Securities and Barclays were the financial advisors to Cabinetworks and BofA is leading the debt financing for the acquisition.

The buy of Cabinetworks by Platinum is expected to close by the end of June 2021.

© 2021 Private Equity Professional | April 6, 2021

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