GHK is building out its 60-year-old kitchen cabinetry platform as more consumers look to fix up their homes during the coronavirus period.
Dura Supreme earlier this week completed the add-on of family-owned Bertch Cabinet in a deal valued at approximately 5X EBITDA, a source told PE Hub. The business generated about $10 million in pro forma EBITDA in 2020, the person said.
Although deal discussions started after the pandemic kicked off, the PE firm’s awareness of Bertch Cabinet dates to its initial platform acquisition of Dura Supreme in October 2019, according to Charlie Fox, principal at GHK who led the transaction.
There were no bankers involved in the proprietary process, he said.
Dura Supreme acquired Bertch Cabinet through debt financing, Fox said. The platform was acquired as a pre-fund deal, although GHK recently held a $150 million first close for its targeted $350 million debut fund.
Waterloo, Iowa’s Bertch Cabinet does two things for the platform: expands its broader product offerings by entering the bath segment and creates cross-selling opportunities.
At the end of the day, “it’s serving the same customers – people focused on improving their homes,” Fox said, highlighting the rise in home renovations amid covid-19.
Gary and Becky Bertch sold the company after owning it for over 40 years. The owners, according to local television station KWWL, will focus on two projects: an under-construction $100 million theme park and an existing family-owned water park.
In the coming months, GHK plans to make some operational improvements and transition Bertch cabinets from a family-owned to a more professionally managed business.
“[The] Bertch family will stay on for a year in a consulting role – just to ease the transition,” Fox said. The business will be immediately managed by Dura Supreme, and an integration consultant will be working with the businesses over the course of six months.
Other management team members will continue on. “All employees are staying with the business,” he said.
Besides Dura Supreme, the Greenwich, Connecticut, firm invested in a pool sanitizing business called Hasa last year. Other platform investments by the new manager include Brown & Settle, a developer of large-scale parcel sites.