W&D Weekly - June 27, 2007 Vol 2 | Num 26
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Private Equity Buy-Out Part of Planned Champion Succession

A private equity group stepped in to purchase a portion of ownership in Champion Window Manufacturing & Supply Co. from its two longtime management leaders, Edward Levine and...

A private equity group stepped in to purchase a portion of ownership in Champion Window Manufacturing & Supply Co. from its two longtime management leaders, Edward Levine and Bernard Barbash. The management succession plan, now six years in the making, gives current management the opportunity to increase its ownership in the company as the two primary owners reduce their day-to-day responsibilities. A privately owned company, Champion has not revealed the name of the private equity group involved in the transaction or the amount of the investment.

As the transition unfolds, Champion will continue its aggressive expansion plans to open another six to eight home improvement stores in the remainder of 2007, Dennis Manes, the company’s new CEO, told a Cincinnati newspaper.

Levine, formerly the CEO, and Barbash, former president and COO, will remain involved with the company as chairmen. Manes steps into the CEO position from his role as vice president and general counsel. Donald Jones will succeed Barbash as president and COO, leaving his role as vice president and general manager.

Cincinnati-based Champion manufactures, sells and installs replacement windows, entry doors, patio room enclosures and basement finishing systems. It has 60 stores in 31 states.

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ATech Joins Forces with Murat Machine

ATech Machine has signed an agreement with Murat Machine of Turkey to represent its line of window and door...

ATech Machine has signed an agreement with Murat Machine of Turkey to represent its line of window and door equipment in the North American market for window and door machinery and equipment.

A manufacturer of vinyl machinery since 1983, Murat Machine operates an 85,000-square-foot facility in Istanbul, where it has a staff of approximately 150 people. In the past three years alone, Murat Machine has manufactured and sold more than 4,800 machines of various types, and its annual sales are in excess of $20 million, reports Murat Cil, president of ATech. With a full research and development department, the company uses the latest technology available, he says. Its line features fully automated four-point welders and CNC corner cleaners. 

ATech Machine was started six years ago and has focused on equipment for small- and medium-sized window and door manufacturers, Cil reports. The company is recognized for its wide range of machinery, equipment and tooling at competitive prices and for providing attentive after-sales service, he adds.

ATech continues to invest in its operations, employing additional technical service engineers, expanding its existing business facilities and establishing dealerships throughout North America, Cil notes. “With this new joint venture with Murat Machine, ATech Machine has now completed its product range up to the automated systems, pushing forward to be the top machinery supplier in the North American market.”

The two companies will display their equipment together at the upcoming GlassBuild America show in Atlanta.

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Dealers of the Year Deadline Approaching

The editors of Window & Door magazine are accepting nominations for the 2007 Dealers of the Year program—but the deadline is fast approaching. Do you work for, supply to or know of an exceptional dealer...

The editors of Window & Door magazine are accepting nominations for the 2007 Dealers of the Year program—but the deadline is fast approaching. Do you work for, supply to or know of an exceptional dealer or distributor focused on windows and doors? By Friday, complete an electronic nomination form to make sure your dealer is in the running for the national recognition program. A downloadable PDF that you can print, fill out and fax back to us is available here.

We will feature the winners of our fourth annual Dealers of the Year program in the October issue of Window & Door. As always, the goal of the program is to highlight excellence and leadership within the industry's channels of distribution.

The program includes two Overall Excellence winners:

Leadership in the Homeowner Market: Recognizing a dealer who primarily serves the remodeling and replacement markets for consistent customer satisfaction, notable business ethics, commitment to the community and other areas that contribute positively to the overall reputation of the window and door industry.

Leadership in the Professional Market: Recognizing a dealer who primarily serves builders and contractors for consistent customer satisfaction, notable business ethics, commitment to the community and other areas that contribute positively to the overall reputation of the window and door industry.

Awards will also be granted in several areas of Focused Excellence:

  • Innovative Thinking: For outside-the-box thinking in business approach and serving customers.
  • Installation: For service beyond the sale.
  • Marketing: For innovative and successful marketing campaigns.
  • Giving Back to the Community: For charity and community service efforts.
  • Retail Program/Showroom: Recognizing efforts to educate and inspire the consumer during the buying process.
  • Customer Service: For those who make buyer satisfaction their top priority.
  • Web site/Technology: A new category this year, we hope to recognize a retailer who excels at integrating technology into the business.
All nominations are due no later than June 29, 2007. Forms may be sent to Christina Lewellen, senior editor, Window & Door, 10 Cottage Court, Warsaw, NY 14569 or emailed to clewellen@glass.org. If you have questions, contact Christina at 585/786-2493.

New Pre-Hanging Association Launched

“In response to a demand from the marketplace for an organization that holds all members on an equal standing,” the American Pre-Hung Door Association has been formed...

“In response to a demand from the marketplace for an organization that holds all members on an equal standing,” the American Pre-Hung Door Association has been formed. With about 20 members currently, APHDA recently launched a Web site to spread the word about the new group to the industry.

The new organization has no specific meeting plans yet, but is looking to host roundtable discussions and regional meetings to build its membership base, reports Georgia Smith, executive director. “We have a core group that’s excited and very much interested in helping to get a new association going.”

To date, members include Bidmaster Corp., Builders Automation Machinery Co., Don Hall & Associates, Full House Co., LJI Technologies and Wise Corp. Target members include both one- and two-step pre-hangers, as well as related millwork companies and industry suppliers, she adds.

It’s similar to the constituency served by the Association of Millwork Distributors, Smith states, but APHDA plans to differentiate itself in a number of ways. One important distinction, she notes, is that while there will be membership categories for different types of companies, “everybody’s equal” as far as voting capabilities.

Don Hall, president of Don Hall & Associates, became involved with the new association early because he feels the subset of prehangers is a group deserving of focus on its own specific needs. He believes there is enough room in the market for both AMD and APHDA. “I could see some people favoring APHDA,” he notes,” but the major suppliers would want to stay with AMD as well. I don’t see it as competition—it’s more of a tighter focus on that segment of the business.”

With more businesses such as lumberyards taking up prehanging operations, Hall believes the new association will be well received. “I’m just amazed at how many people are getting into the pre-hung door business,” he says. “It’s really taking off.”

Smith explains that the new association intends to be charity-oriented. Current discussions include establishment of a scholarship program as well as an industry-specific program similar to the Service Corps Of Retired Executives (SCORE). “We want to enable people to tap into the wisdom that’s out there. There are many out there from the industry that would like to give a hand to help people out too.”

Immediate plans include further development of the membership base. Depending on its success in signing up new members, APHDA has tentatively targeted May 2008 for an exposition bringing together suppliers and pre-hangers.

APHDA corporate offices are in Flower Mound, Texas, while executive offices are located in Palm Harbor, Fla. More information about the organization is available at its Web site, http://www.aphda.org, or by calling 866/704-7147.

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Home Depot Exiting Pro Distributor Business

The Home Depot has entered into an agreement to sell HD Supply to a group of private equity firms for $10.3 billion...

The Home Depot has entered into an agreement to sell HD Supply to private equity firms Bain Capital Partners, The Carlyle Group and Clayton, Dubilier & Rice for $10.3 billion. The move is designed to let the home improvement dealer focus on its core retail business.

Once seen as an opportunity for growth at the Home Depot, the HD Supply wholesale distribution business grew rapidly through acquisition while Bob Nardelli served as chairman and CEO. With more than $12 billion in annual sales and some 26,000 locations, the unit encompasses companies serving primarily the plumbing, electrical and maintenance industries. HD Supply did make a number of inroads into the lumber and building materials market, however, acquiring Williams Bros., in Georgia, and Cox Lumber in Florida.

Disappointment among shareholders with the performance of Home Depot stock, as well as concerns that it was losing some of its luster in the retail market led the company to begin a strategic review of HD Supply earlier this year. “Today’s decision reflects our continued commitment to enhancing shareholder value, through an exclusive focus on our retail business and the return of cash to our shareholders,” says Frank Blake, who succeeded the ousted Nardelli as Home Depot chairman and CEO. “This year alone we will spend more than $2 billion in support of our top five retail priorities. We are confident in the ability to improve productivity in our retail business through investment in these priorities, which will further enhance returns on invested capital as the investments take hold,” said Blake.

Meanwhile, the private equity groups acquiring HD Supply see significant growth and consolidation opportunities for the company. “HD Supply enjoys premium positions in an attractive, $400+ billion market where we have deep experience and prior investment success,” says David A. Novak, a partner with Clayton, Dubilier & Rice. “Working with our partners, as well as a strong management team, we are confident that we can achieve multiple strategic and operational improvements to enhance the company’s performance.”

“Management and employees of HD Supply have built tremendous franchises in various building products markets,” adds Dan Pryor, a managing director at Carlyle. “We look forward to working with the company to deliver more value to customers by enhancing and growing these businesses.”

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Riverside is First City to Provide Incentives for California Green Builder Program
from dBusinessNews.com
The City of Riverside on Tuesday became the first community in California to provide incentives to builders who utilize the voluntary California Green Builder program as a way to meet the city’s “Clean and Green” requirements, the California Building Industry Association announced today... read more

Public Finally Gets to Tour Glass House
from The Connecticut Post Online
One of America's hottest new tourist attractions, the iconic Glass House and 47-acre estate of the late architect Philip Johnson, opens this Saturday in New Canaan. But unless you've already secured tickets, the likelihood of soon stepping foot onto this amazing site is slim to none. The National Trust for Historic Preservation, which owns and operates the landmark, has announced that tour tickets have sold out for the site's inaugural public season. That's the bad news... read more

Americans Express Confidence in the Value of Their Homes, Despite Softening Housing Market
from Yahoo! Finance
Americans are confident their homes are retaining, even gaining, value, according to a nationwide telephone survey conducted this month by The Boston Consulting Group.

In fact, Americans are nearly as optimistic now about the rising value of their homes as they were a year ago, according to the research... read more

Top Home Sellers' Markets
from Forbes.com
If you've got property for sale, chances are you're in a bind: Nationwide, prices for existing homes keep on falling and new home constructions started a few years ago continue to roll off the conveyer belt, upping inventory.

On top of that, the fallout from subprime lending, the subsequent tightening of credit and lending standards, and the recent rise in long-term treasury yields has shrunk the pool of eligible buyers. Feel like you can't catch a break? You're not alone.

Not every market follows national trends and despite the industry's overall problems, there are still cities where sellers have the upper hand... read more