UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): February 27, 2018
JELD-WEN HOLDING, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-38000 | 93-1273278 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) | ||
| 440 S. Church Street, Suite 400 Charlotte, North Carolina |
28202 | |||
| (Address of principal executive offices) | (Zip code) | |||
Registrant’s telephone number, including area code: (704) 378-5700
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (See General Instruction A.2 below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On February 28, 2018, JELD-WEN Holding, Inc. (the “Company”) issued a press release announcing the departure of President and Chief Executive Officer, Mark Beck, effective February 27, 2018, by mutual agreement. Under the terms of his employment agreement, Mr. Beck’s service as a director of the Company and its subsidiaries also ended on that date. Until a successor is determined, Kirk Hachigian, 58, Chairman of the Board and former CEO of the Company, has assumed Mr. Beck’s duties as the Company’s interim CEO, effective February 27, 2018. Mr. Hachigian’s biographical information is incorporated by reference to Part III, Item 10 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, filed with the Securities and Exchange Commission on March 3, 2017. There is no arrangement or understanding between Mr. Hachigian and any other persons pursuant to which Mr. Hachigian was selected as the Company’s interim CEO. There are no family relationships between Mr. Hachigian and any director or executive officer of the Company and no transactions involving Mr. Hachigian that would require disclosure under Item 404(a) of Regulation S-K.
The Company’s Board of Directors has agreed to pay Mr. Hachigian a biweekly consulting fee of $76,923 for services as interim CEO. In addition, Mr. Hachigian received a grant of 314,267 restricted stock units on February 27, 2018, which will vest in one year based upon the portion of the next twelve months in which Mr. Hachigian serves as interim CEO.
A copy of the press release announcing Mr. Beck’s departure and Mr. Hachigian’s appointment is filed as Exhibit 99.1 to this report.
| Item 7.01 | Regulation FD Disclosure. |
The Company’s press release attached hereto as Exhibit 99.1 also provides an update for the Company’s outlook for the fiscal year 2018 to reflect the contribution of the acquisition of A&L Windows Pty Ltd (“A&L”), disclosed in Item 8.01 of this report, and an Adjusted EBITDA outlook for the first quarter of 2018.
| Item 8.01. | Other Events. |
On February 28, 2018, the Company announced the signing of a definitive agreement to acquire all of the outstanding shares of American Building Supply, Inc., a premier supplier of value-added services for the millwork industry.
On February 28, 2018, the Company also announced the acquisition of A&L, a leading Australian manufacturer of residential aluminum windows and patio doors.
A copy of the press release announcing these acquisitions is filed as Exhibit 99.1 to this report.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: February 28, 2018 | JELD-WEN HOLDING, INC. | |||||
| By: | /s/ Laura W. Doerre | |||||
| Laura W. Doerre | ||||||
| Executive Vice President, General Counsel and Chief Compliance Officer | ||||||
Exhibit 99.1
JELD-WEN Holding, Inc. Announces CEO Leadership Transition, Announces Two Acquisitions, and Updates 2018 Outlook for the Impact of Closed Acquisition
Charlotte, N.C. – JELD-WEN Holding, Inc. (NYSE:JELD) (“JELD-WEN” or the “Company) today announced a leadership transition with Chairman of the Board, Kirk S. Hachigian, assuming the duties of CEO on an interim basis; announced an agreement to acquire American Building Supply, Inc. (“ABS”); announced the acquisition of A&L Windows Pty Ltd (“A&L”); and updated its outlook for first quarter and full year 2018 for the impact of the A&L acquisition.
CEO Leadership Transition
The Board of Directors of the Company announced the departure of President and CEO, Mark Beck, effective February 27, 2018, by mutual agreement. Under the terms of his employment agreement, Mr. Beck’s service as a director also ended on that date. Mr. Hachigian, Chairman of the Board and former CEO of the Company, will assume Mr. Beck’s duties while the Board conducts a search for a new CEO.
“We appreciate Mark’s contributions to the Company during his tenure,” commented Mr. Hachigian. “JELD-WEN remains committed to delivering long-term value to our shareholders through solid execution on all aspects of our operating model, including operational excellence, profitable organic growth, and strategic M&A. Our strong and experienced executive management team will work closely with me to make this leadership transition seamless for our customers, shareholders and employees.”
Agreement to Acquire American Building Supply, Inc.
JELD-WEN has signed a definitive agreement to acquire all of the outstanding shares of ABS. ABS excels in supporting distributors, dealers, and home centers with a broad product range of doors, frames, and hardware for both the residential and commercial markets. Through its Doormerica® division, ABS manufactures a broad selection of decorative, specialty, and architectural doors, including the Millennium Door series. ABS has developed a reputation as a premier supplier of value-added services for the millwork industry, through a relentless focus on quality and service.
“The acquisition of ABS aligns perfectly with our strategy to expand our door capabilities with value-added services and customized full door systems. ABS, together with our recent acquisition of MMI Door, will expand our ability to offer these services to our customers with a broad geographic coverage area across the U.S.,” said John Linker, Senior Vice President Corporate Development and Investor Relations. “With ABS’s capabilities in quick-ship customizable configurations, hardware options, and specialized component offerings, we will improve our service offerings and lead times for our
channel partners. We look forward to welcoming the entire ABS team to the JELD-WEN family.”
JELD-WEN expects the transaction to close late in the first quarter of 2018, subject to customary closing conditions. Terms of the acquisition were not disclosed.
JELD-WEN has a long and valued partnership with ABS as a supplier of door and window products. As a result of the acquisition, JELD-WEN expects to add approximately $275 million in incremental annualized revenue. JELD-WEN expects the acquisition to be immediately accretive to adjusted EPS in 2018. ABS’s adjusted EBITDA margins initially will be lower than JELD-WEN’s adjusted EBITDA margins, until expected synergies are achieved.
Acquisition of A&L Windows Pty Ltd
JELD-WEN today completed the acquisition of A&L, a leading Australian manufacturer of residential aluminum windows and patio doors. Founded in 1980, A&L has a long history of supporting homebuilders and contractors with innovative products and high-quality service. With a network of manufacturing facilities and showrooms across the eastern seaboard of Australia, A&L has a well-known brand and strong reputation.
“A&L’s excellent position in the first-time home buyer market expands the reach of our current product range and customer base. The addition of A&L’s brand name expands our portfolio of leading Australian brands and supports our strategy to build leadership positions in attractive markets,” said John Linker, Senior Vice President Corporate Development and Investor Relations. “We expect to deliver synergies through operational savings from the implementation of JEM and by leveraging the benefits of our combined supply chain. We are pleased to welcome the entire A&L team to the JELD-WEN family.”
A&L was privately held by its founders. Terms of the acquisition were not disclosed.
JELD-WEN expects the acquisition to add approximately AU$130 million in annualized revenue. Additionally, JELD-WEN expects the acquisition to be immediately accretive to EPS in 2018.
Outlook for First Quarter and Full Year 2018
Including the expected contribution of the A&L acquisition, but excluding the impact of the pending ABS acquisition, the Company now expects full year 2018 net revenue growth of 10% to 13% compared to the previous outlook of 8% to 11%. The Company now expects full year 2018 adjusted EBITDA of $505 million to $535 million compared to the previous outlook of $500 million to $530 million. The outlook for full year 2018 capital expenditures remains unchanged at $100 million to $125 million. The Company’s adjustments to its 2018 outlook relate solely to the impact of the A&L acquisition.
Additionally, for the first quarter of 2018, the Company expects adjusted EBITDA of $80 million to $86 million. The outlook for the first quarter is consistent with the Company’s previously disclosed expectations.
About JELD-WEN
JELD-WEN founded in 1960, is one of the world’s largest door and window manufacturers, operating over 120 manufacturing facilities in 19 countries located primarily in North America, Europe and Australia. Headquartered in Charlotte, North Carolina, JELD-WEN designs, produces and distributes an extensive range of interior and exterior doors, wood, vinyl and aluminum windows and related products for use in the new construction and repair and remodeling of residential homes and non-residential buildings. JELD-WEN is a recognized leader in manufacturing energy-efficient products and has been an ENERGY STAR® Partner since 1998. Our products are marketed globally under the JELD-WEN® brand, along with several market-leading regional brands such as Swedoor® and DANA® in Europe and Corinthian®, Stegbar®, and Trend® in Australia. For more information visit www.jeld-wen.com.
Forward-Looking Statements
Certain of the statements in this press release constitute “forward-looking statements” within the meaning of the U. S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identified by our use of words such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “might”, “plan”, “potential”, “predict”, “seek”, or “should”, or the negative thereof or other variations thereon or comparable terminology.
Forward-looking statements regarding market potential, future financial performance, and our expectations, beliefs, plans, assumptions, or other future events are made based on management’s current expectations, assumptions, estimates, projections, and beliefs concerning future developments and their potential effects upon JELD-WEN and its subsidiaries. Although we believe that these statements are based on reasonable expectations and estimates, they are not a guarantee of future performance and involve known and unknown risks and uncertainties, many of which are beyond our control, that could cause actual outcomes and results to differ, possibly materially, from those indicated in such statements, including those discussed in our Annual Reports on Form 10-K and Quarterly Report on Form 10-Q, filed with the U.S. Securities and Exchange Commission. You should not place undue reliance on forward-looking statements included in this release, which speak only as of the date they are made. We do not undertake to update or revise any forward-looking statement, except as required by law.