GBO Inc. Divests PVC and Steel Divisions; Will Focus on Wood WindowsJune 30th, 2009 by Editor
GBO INC. has entered into an agreement with Farley WinDoor Ltd., a door and window manufacturer based in Alexandria, Ontario, by which Farley will acquire all of the operating assets and related inventories of GBO’s divisions specializing in the manufacture, selling and distribution of PVC windows and steel doors. The transaction is expected to close in July of 2009. GBO will receive an aggregate cash payment of $12.5 million, payable as follows: (i) $500,000 non-refundable deposit which was paid on May 29, 2009; (ii) $11,000,000 at closing; and (iii) $1,000,000 upon the 12-month anniversary of the closing, which amount will bear interest.GBO officials say they intend to use a significant portion of the proceeds of the transaction to pay down its currently outstanding debt.
Upon the completion of the transaction, GBO will continue its operations as a manufacturer of wood doors, windows and wood accessories.
“Over the past two years, in particular, we have invested substantially to completely reorganize and optimize the manufacturing operations of our Ste-Marie de Beauce (Quebec) plant, to equip this facility with cutting-edge equipment and to develop several new products,” says chairperson of the GBO Board of Directors, Christopher Wood.
“In fact, the broadening of our selection of architectural wood products not only underpins our leadership in Eastern Canada, but also spearheads our development strategy in the United States, which is an essential component of GBO’s long-term strategy. This return to basics will enable us to focus the bulk of our resources and investments on our field of excellence, which is especially advantageous as the barriers to entry into the wood product segment are higher than into other categories of fenestration products.”