Daily News: December 1, 2017

Wells Fargo Provides $100MM Revolver to Support American Woodmark Buy

American Woodmark entered into a definitive agreement and plan of merger with RSI Home Products, a manufacturer of kitchen and bath cabinetry and home storage products

The implied enterprise value for RSI is approximately $1.075 billion, including $140 million in American Woodmark common stock to be issued to RSI shareholders (based on the most recent five trading day average closing price), approximately $346 million in net cash to be paid to RSI shareholders and approximately $589 million of RSI debt to be assumed by American Woodmark. The cash portion of the consideration is subject to customary working capital adjustments.

Founded in 1989 by Ron Simon, RSI is now one of the largest in-stock and value-based cabinet makers in North America, providing kitchen, bathroom, home and garage organization cabinetry, counter tops and accessories to home centers, builders, dealers and remodeling contractors.

“RSI has built a tremendous reputation and position in our industry by delivering quality products at a compelling value position, and we are excited to welcome them to the American Woodmark family,” said Cary Dunston, American Woodmark’s chairman and CEO.

American Woodmark expects to fund the $346 million net cash payment and transaction fees and expenses with cash on hand and committed financing from Wells Fargo Bank. American Woodmark also expects to enter into a new $100 million revolving credit facility with Wells Fargo to replace its existing revolver and, if necessary, may draw on such facility for any remaining cash payments for the transaction.