Publicly traded MasterBrand has agreed to acquire Supreme Cabinetry from GHK Capital Partners for $520 million in cash.
GHK Capital acquired Supreme Cabinet (then Dura Supreme Cabinetry) in October 2019 from the company’s second-generation founding family. The company was founded in Minnesota by Donald Stotts in 1954 and operated a 220,000 sq. ft. manufacturing facility in Howard Lake, Minnesota.
GHK Capital expanded its cabinet platform in January 2021 with the acquisition of Bertch Cabinet Manufacturing, an Iowa-based manufacturer of premium, semi-custom kitchen and bath cabinets. In April 2023, the company further expanded by opening a new 300,000 sq. ft. manufacturing facility in North Carolina.
Today, Supreme Cabinet is led by CEO Tony Sugalski and goes to market under the Dura Supreme and Bertch brands. The company is headquartered 40 miles west of Minneapolis in Howard Lake, Minnesota, with two additional manufacturing facilities in Iowa and North Carolina.
According to MasterBrand, the purchase price for Supreme Cabinet is equal to 8.9x Supreme’s TTM Adjusted EBITDA through March 2024; and if anticipated procurement, facility optimization, and overhead cost synergies of $28 million are realized, the valuation multiple is 5.9x.
MasterBrand (NYSE: MBC) is the largest manufacturer of residential kitchen and bathroom cabinets in North America. The company’s framed and frameless, stock, semi-custom and premium cabinet products are available in a variety of designs, finishes and styles, and are sold through a distribution network of over 4,400 dealers, major retailers and builders.
MasterBrand was previously part of Fortune Brands Home & Security (which had spun out of Fortune Brands in 2011). In 2022, Fortune Brands Home & Security separated into two publicly traded companies: MasterBrands and Fortune Brands Innovations. Today, MasterBrand is led by CEO Dave Banyard and had revenues in 2023 of more than $2.7 billion and more than 12,000 employees located in 20 manufacturing facilities and offices.
Greenwich, Connecticut-based GHK invests in companies with $15 million to $40 million of EBITDA that are active in the manufacturing, building products and services, business services, distribution and logistics, packaging, and general industrial sectors.
Jefferies and Harris Williams are the financial advisors to Supreme Cabinet, and Rothschild & Co is advising MasterBrand.
The closing of this acquisition is expected to be completed during the third quarter of 2024.
© 2024 Private Equity Professional | May 23, 2024
