Report: Jeld-Wen Exploring Sale After Filing IPO

August 11th, 2016 by Trey Barrineau

Door and window giant Jeld-Wen, which filed for an initial public offering (IPO) in June, is now “sounding out potential buyers” through a process known as a “dual-track,”  according to a Wall Street Journal article citing unnamed sources with knowledge of the plan. The newspaper reports that pursuing the dual-track strategy could net $3 billion for Jeld-Wen, vastly higher than the maximum aggregate offering price of $100 million the company reported in its IPO.

A dual-track strategy is when a privately held business launches an IPO while also courting buyers. When a company is bought after filing an IPO, it can boost the selling price by as much as 26 percent, according to a 2010 study by researchers at Brigham Young University and the University of South Florida that was published in the Journal of Business Venturing.

According to a 2010 Wall Street Journal report, the dual-track strategy is common for companies owned by private-equity  firms; Jeld-Wen is partially owned by Canadian private-equity firm Onex Corp.

Days after the Jeld-Wen IPO, the Financial Post reported that Onex will use the IPO to sell its stake in door and window manufacturer.

 

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