American Woodmark spends $1B for cabinet maker RSI Home Products
American Woodmark (Nasdaq: AMWD) has agreed to purchase RSI Home Products Inc., a distributor of kitchen cabinetry and home storage products, for approximately $1.075 billion in cash and stock.
Founded in 1989 by interior designer Ron Simon, RSI Home has grown into one of the largest U.S. manufacturers of cabinets for the kitchen and bathrooms. The Anaheim, California-based target also supplies counter tops, home and garage organization cabinetry, and other accessories to home centers, builders, dealers and remodeling contractors. The deal for RSI brings the buyer a broader portfolio of branded products distributed made to order, in-stock and with special express options in more than 100 styles and finishes.
"This merger creates a company that will be a stronger competitor in the kitchen and bath industry than RSI could be on its own,” states Simon, director of RSI Home. “We believe RSI is the industry's lowest cost manufacturer, and American Woodmark has unmatched logistics and service capabilities, as well as a very broad product line.”
American Woodmark, headquartered in Winchester, Virginia, manufacturers more than 500 cabinet styles for the remodeling and new home construction markets. The buyer distributes its products under four brands: American Woodmark, Shenandoah Cabinetry, Timberlake Cabinetry, and Waypoint Living Spaces. The deal for RSI Home is expected to close by January 31, 2018.
Maker of home goods are benefiting from trends in the real estate market, including increases in the purchases of new homes. Related deals include: Z Capital Partners’ purchase of fireplace manufacturer Twin-Star International Inc.; Hooker Furniture Corp.’s (Nasdaq: HOFT) acquisition of Home Meridian International Inc.; and Mattress Firm Holding Corp.’s (Nasdaq: MFRM) completed mergerl for rival Sleepy’s.
Robert W. Baird & Co. Inc. is serving as financial adviser to American Woodmark, while McGuireWoods LLP is serving as legal counsel. Intrepid Investment Bankers LLC is serving as financial adviser to RSI Home, and O'Melveny & Myers LLP is serving as legal counsel.