Back on March 1st, Masco in the US announced that it was to review “strategic alternatives” for it’s window and cabinetry businesses, and that it was to be concluded by the end of June. You can read that article on the Masco website here.
Well, we’re in mid-June now, and if they’re running on time, it means their review will be in the final stages and may already begin to know what they want to do with it. We’re approaching a signficant moment.
Just as a little reminder, this was the key paragraph from that article:
Over the past five years, we have been executing our strategy to drive the full potential of our core businesses, leverage opportunities across our organization, and actively manage our portfolio to drive shareholder value,” said Keith Allman, Masco’s President and CEO. “Our Cabinetry and Window businesses are leaders in their respective markets and are well positioned to continue their growth. However, we believe we can potentially drive greater shareholder value by exploring strategic alternatives for these businesses. We expect to complete this review by the end of June.
That’s a lot of embelished language, which in short means they’re looking to sell. Masco is based in the US, but owns the UK Window Group. Their brands include:
- UK Fabrication
- Phoenix Doors
- UK New Build
- Seven Day
It’s not clear whether part, or all of this group would be up for sale. The gem (in my opinion at least) is Evolution. One of the founding companies of the timber alternative movement in UK fenestration. For those who might be looking to acquire some or all of the available brands, this will be the stand out one.
We’re in mid-June now. Only a couple of weeks away from the end of Masco’s own deadline of the end of the month for this review period.
Up for sale
In my previous post I mentioned that the industry does still seem over-populated given the amount of demand that is out there. You can catch up on that post here.
As I see it, everyone is up for sale right now. I speak to people on a regular basis who pass on various bits of rumours and tit bits of information about who might be looking what. I’m not saying that it’s all truth, but rumours tend to start from somewhere, and more often than not some form of the whisper comes to fruition in real life.
At the moment, there does seem to be a lot of potential M&A activity out there about now. Currently there does appear to be too many installers and fabricators out there. It may well be that over the next 12 to 18 months some major industry consolidation could happen.
What will be worth watching, if consolidation does happen, is who is doing the buying. If it’s the very biggest snapping up rivals or smaller companies to gain new market footholes, it could reduce the amount of competition within the market place. That has long been the worry of many in the industry. For example, and this is only an example, if systems companies decide to go after systems companies, you’ll end up with a situation where only a handful of companies own the mass majority of profile being bought by most of the industry.
So, as the industry looks set to go through another period of volatility and M&A activity, we could be about to reset the current dynamics of the sector.
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