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PGT Innovations to Acquire Western Window Systems

PGT expands product portfolio in premium indoor/outdoor window and door category

PGT Innovations, the leading U.S. manufacturer and supplier of impact-resistant windows and doors, and Western Window Systems announced that they have entered into a definitive agreement under which PGT Innovations will acquire Western Window Systems from PWP Growth Equity, the middle market private equity group of Perella Weinberg Partners, for 360 million USD in cash, subject to customary adjustments. The transaction is expected to be completed in the third quarter of 2018.

This transaction supports PGT Innovations’ expansion outside of Florida, an important component of its strategic roadmap for growth. With the addition of Western Window Systems, PGT Innovations expects to gain a strategic platform in important and growing geographies throughout the western United States, including California, Texas, Arizona, Nevada, Colorado, Oregon, Washington and Hawaii. The strategic transaction builds on PGT Innovations’ already strong foundation, positions it to focus on high-growth contemporary architectural designs and indoor/outdoor living spaces and is expected to support sustainable long-term success. The acquisition will combine the complementary strengths of Western Window Systems and PGT Innovations, providing the opportunity to integrate Western Window Systems’ category-leading business into PGT Innovations’ portfolio.

Western Window Systems, which has sales in 40 states, is a leader in contemporary window and door systems designed for unifying indoor/outdoor living spaces. Western Window Systems has a strong track record of profitability and is expected to achieve net sales of approximately 126 million USD to 132 million USD and an adjusted EBITDA margin of between 23 percent and 24 percent for fiscal 2018. Western Window Systems expects to achieve a net sales compounded annual growth rate of approximately 22 percent from 2015 through the end of 2018. Western Window Systems ended the first six months of 2018 with record backlog and has no history of significant seasonality. For the twelve-month period ended December 31, 2018, on a pro forma basis, the combined company is expected to generate approximately 706 million USD to 732 million USD in net sales and approximately 135 million USD to 148 million USD or 19 percent to 20 percent in adjusted EBITDA, including certain anticipated pro forma cost synergies.

“We are excited to add Western Window Systems to the PGT Innovations family of brands,” said Jeff Jackson, President and Chief Executive Officer of PGT Innovations. “This transaction unites two highly complementary businesses to create a national leader in the premium window and door space, with an expanded product portfolio tailored to provide significant benefits for our collective customers. Western Window Systems delivers growth by disrupting industry norms and adopting non-traditional approaches to contemporary windows and doors systems. With a developed footprint across the South and West, we believe the combined company will be well positioned to drive profitable, sustained growth, including opportunities to introduce our respective products to each other’s customer base. The transaction is expected to be accretive in the first year and facilitate strong cash flow generation, enabling us to deliver quickly. We believe this transaction will accelerate our ability to enhance value creation for our shareholders.”

“PGT Innovations is an organization whose values and culture align with our own,” said Scott Gates, President and Chief Executive Officer of Western Window Systems. “PGT Innovations’ enviable understanding of, and sales into, the repair and remodel market provides a great opportunity for collaboration to service our customers’ total business needs and the needs of new dealer customers who have a focused presence in that segment. We look forward to working closely with Jeff and the PGT Innovations leadership team to continue our focus on innovation and excellence as part of a more diversified company that we believe will be even stronger. Additionally, we thank PWP Growth Equity for all of their collaboration and support in helping us achieve tremendous growth over the past few years.”

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