MasterBrand to Acquire Supreme Cabinetry Brands for $520 Million
Jasper, Indiana – MasterBrand, Inc. (NYSE: MBC) announced that it has entered into a definitive agreement to acquire Supreme Cabinetry Brands, Inc. from GHK Capital Partners LP for $520 million in cash. The transaction includes approximately $25 million in net present value of cash tax attributes and represents a multiple of approximately 8.9x Supreme’s adjusted EBITDA for the twelve months ended March 31, 2024, or approximately 5.9x when including anticipated annual run-rate cost synergies of $28 million.
The acquisition is intended to strengthen MasterBrand’s market reach by leveraging Supreme’s established dealer network and premium cabinetry portfolio. MasterBrand expects the transaction to deliver meaningful value creation through expanded product offerings, improved operational efficiency, and enhanced customer and consumer experiences.
“The addition of Supreme’s premium kitchen and bath cabinetry will enable MasterBrand to provide unmatched breadth and service to our customers and consumers,” said Dave Banyard, CEO of MasterBrand. “Supreme’s complementary products will expand our portfolio and accelerate our strategic priorities.”
Tony Sugalski, CEO of Supreme Cabinetry Brands, added, “We are excited to join the MasterBrand family. Combining our craftsmanship with MasterBrand’s scale and resources will allow us to deliver greater value to our customers and consumers.”
MasterBrand expects the transaction to generate approximately $28 million in annual cost synergies by the end of the third year following closing, along with additional commercial synergies across complementary channels and product lines. The acquisition is expected to be accretive to adjusted diluted earnings per share within the first full year after closing.
Timing, Financing, and Approvals
The transaction is expected to close in the third quarter of 2024, subject to customary closing conditions, including antitrust clearance in the United States. MasterBrand plans to finance the acquisition using a combination of cash on hand and existing credit facilities, along with an incremental debt commitment from JPMorgan Chase Bank, N.A.
On a pro forma basis, MasterBrand expects net debt to adjusted EBITDA to be approximately 2.4x to 2.6x at closing. The company plans to reduce leverage to below 2.0x within two years following the completion of the transaction.
Advisors
Rothschild & Co is serving as MasterBrand’s exclusive financial advisor. Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal counsel.
About MasterBrand
MasterBrand, Inc. (NYSE: MBC) is North America’s largest manufacturer of residential cabinets, offering a broad portfolio of products for kitchens, bathrooms, and other areas of the home. With more than 12,000 associates across over 20 facilities, MasterBrand’s brand portfolio includes Aristokraft, Decora, Diamond, Fieldstone Cabinetry, HomeCrest, Kemper, KitchenCraft, Mantra, Mid-Continent Cabinetry, Omega, Schrock, Starmark, Thomasville, UltraCraft, and Urban Effects Cabinetry.
About Supreme Cabinetry Brands
Supreme Cabinetry Brands, Inc. is a leading U.S. manufacturer of premium residential cabinetry, featuring the well-known Dura Supreme and Bertch brands. The company operates manufacturing facilities in Minnesota, Iowa, and North Carolina.
About GHK Capital Partners LP
GHK Capital Partners LP is a middle-market private equity firm focused on investing in industrial businesses across North America.
Forward-Looking Statements
This press release contains forward-looking statements based on current plans, expectations, and assumptions of management. Actual results may differ materially due to various risks, uncertainties, and other factors. Readers are encouraged to review MasterBrand’s filings with the U.S. Securities and Exchange Commission for additional information. MasterBrand undertakes no obligation to update any forward-looking statements as a result of new information or future events.
