PGT Innovations receives unsolicited bid that beats previous $3B offer

Miter Brands, a national window and door manufacturer that traces its history, in part, to post-World War II Florida, has made a third bid to acquire the largest publicly traded company in the Sarasota-Bradenton region, Venice-based PGT Innovations, which also has a national footprint in the window and door manufacturing sector. 

The offer comes two weeks after PGT and Tampa manufacturer and distributor of interior and exterior doors Masonite agreed on a separate pending acquisition. In that deal, Masonite said it would pay $3 billion in a combination of cash and Masonite shares for PGT. That comes out to $41 a share, split $33.50 in cash and $7.50 of its common stock. The offer, at the time, represented a premium of 56.5% over PGT’s Oct. 9 closing price of $26.20. (PGT’s stock has since risen to $42 a share.)

The new Miter bid, which PGT disclosed Tuesday evening, is for $41.50 a share in cash. 

PGT officials, in the Tuesday statement, said “consistent with the terms of the Masonite merger agreement, PGT Innovations’ Board of Directors, in consultation with its independent financial and legal advisors, will carefully review Miter Brands’ proposal to determine if it is reasonably likely to lead to a superior proposal. PGT Innovations will have no further comment on Miter’s proposal until the board has completed its review. PGT Innovations’ shareholders are advised to take no action at this time.”

Masonite officials, in a separate statement, said the firm “remains fully committed to the binding transaction with PGT Innovations we announced Dec. 18. The terms of this transaction provide PGT Innovations shareholders with compelling value and Masonite is swiftly progressing all workstreams necessary to advance the transaction to a successful closing.”

The potential PGT-Masonite deal is the largest in the region in a generation and would create a window and door behemoth, with more than $4 billion in annual revenue. Masonite is ranked No. 8 in the Business Observer's 2023 Big Book of Business, while PGT is No. 16. Masonite had 2022 revenue of $2.9 billion, up 11.35% from 2021. PGT had revenue of $1.49 billion in 2022, up 28.5% from 2021. 

Miter, meanwhile, has set its sights on PGT at least twice before. 

In October, Miter made an offer to buy PGT for $1.9 billion, according to a report in Reuters. PGT rejected the offer, what Reuters called a “fully-financed $33-per-share bid.” Miter was back in December, before Masonite, with an offer it raised to $2.2 billion. 

Reuters also reported that in March PGT adopted a so-called poison pill to prevent “any investor from accumulating a position of 10% or more in its stock for a period of 12 months. It attributed the move to ‘a likely accumulation of PGT shares by a strategic investor,’ which it did not identify.”

Miter was formed in 2019, a combination of the merger between two separate brands: MI Windows and Doors and Milgard. That 2019 deal was completed with the aid of $350 million in financing from Koch Equity Development, an investment arm of the Koch family and its industrial businesses. Koch Equity, according to its website, owns 20% of the company, while the controlling entity remains the DeSoto family.  Matt DeSoto is the CEO of Miter Brands, which rebranded under that name in 2022, according to a statement. 

MI Windows and Doors, according to its website, was founded in Florida in 1947, initially under the name Metal Industries.