Cabinetworks Acquisition Touted by Leading Industry Analyst
LOS ANGELES — The acquisition of The Cabinetworks Group by a major private-equity firm will position the nation’s largest independently owned manufacturer and distributor of kitchen and bath cabinets for “significant future growth,” a leading industry analyst is predicting.
Matt Zielenski of the Cleveland, OH-based Freedonia Group, said that the recent acquisition of the former Masco Cabinet Division by Los Angeles-based Platinum Equity will enable The Cabinetworks Group’s new ownership “to maximize the value of these assets and, combined with its capital resources, be able to further position the company for growth as the U.S. economy rebounds from the worst effects of the COVID-10 pandemic.”
Platinum Equity announced in April that it had entered into a definitive agreement to acquire The Cabinetworks Group, which consists of KraftMaid, Medallion, Smart, Merillat, Yorktowne, Echelon, Advanta, Studio Full Access, Master WoodCraft and Cabinets 2000. The company operates out of 14 assembly plants and three component facilities, produces both framed and frameless cabinetry, and serves customers through a multi-channel approach, including sales to dealers, home centers and distributors. Terms of the transaction, expected to close in the second quarter of 2021, were not divulged.
Founded in 1995, Platinum Equity has more than $25 billion of assets under management, and portfolio of some 40 operating companies. Other companies that the private-equity firm previously invested in within the building products sector include Interior Logic Group, a major provider of interior design and finish solutions, and PrimeSource, a national distributor of specialty building materials for the new construction and remodeling markets.
“Cabinetworks has a comprehensive portfolio of highly-respected, fast-growing brands, a strong leadership team and a proven track record for growth,” said Jacob Kotzubei, a partner at Platinum Equity. “The company’s leading position in the cabinet space, combined with Platinum Equity’s operational toolkit and M&A resources, make Cabinetworks a great fit for our portfolio.”
Platinum Equity’s purchase of Cabinetworks “will position the firm to enter the U.S. cabinet industry, which is currently seeing strong growth,” said The Freedonia Group’s Zielinski. “The new-housing market has seen strong demand for cabinets, as home builders are able to sell homes as soon as they are completed.
“In the large home improvement market, kitchen and bathroom remodeling is a perpetually popular renovation, and they have seen substantial growth in the past year as millions of homebound Americans have undertaken such projects, of which the installation of new and larger cabinets is a key part,” Zielinski added.