Sarasota business community embraces PGT deal even as headquarters expected to shift north

The news that one of Sarasota County's largest private employers is being acquired has been met with excitement by trade partners and local business leaders, even as the headquarters of one of the region's brightest business stars will shift north to Tampa after the deal closes sometime in mid-2024.

Masonite International Corporation has agreed to buy Venice's PGT Innovations in a deal valued at $3 billion, while touting the potential of $100 million in annual cost-saving synergies.

Though both firms are behemoths in the window and door construction market, Masonite's primary trade partners have been large institutional wholesale buyers, while PGT's biggest customers have been dealers who sell directly to residential costumers.

The two companies were billed as complementary during a conference call with stock market analysts on Monday, as several executives highlighted future growth opportunities through selling products across the combined company's customer base, according to a transcript of the call posted to the U.S. Securities and Exchange Commission website.

However, analysts were told about half of the $100 million in "cost-saving synergies" will come from reduced expenses that could begin to be "unlocked" within the first two years of the deal's closing.

"... You could see some of those savings before year end 2024, you’d more likely realize them in full toward the second half of 2025 and early 2026," Masonite CFO Russell Tiejema said. "So it’s a two-year ramp over which we believe those cost synergies can be unlocked."

What was meant by unlocking cost synergies was not explained in detail.

In response to an email to PGT Innovations seeking additional information on the merger and its impact on local operations, a representative for the company sent a statement attributed to PGT Innovations President and CEO Jeff Jackson.

"PGT Innovations and Masonite share deep roots in the state of Florida and look forward to continuing to be an important part of our communities," Jackson said in the statement.

PGT starts small, grows to $1.5 billion in revenue

The Venice-headquartered company was co-founded by Rodney Hershberger in 1980 as Vinyl Tech, before it rebranded to Progressive Glass Technology and eventually PGT Innovations. In recent years, PGT has been one of the most notable business success stories in Sarasota County history as well as one of the region's biggest business boosters, often supporting local community events with sponsorships and leadership.

Twenty years ago, the company's revenue was an impressive $250 million, but that's just a fraction of what the company will generate this year, with about $1.5 billion in revenue over the previous 12 months of financial records.

PGT's current Sarasota County headcount has been reported at about 2,500 people, with another about 3,000 people working outside the region.

Kathy Lehner, president and chief executive officer with the Venice Chamber of Commerce, said the local chamber has about 1,000 members with PGT being "one of the largest."

PGT officials have joined numerous community organizations in leadership positions ranging from local nonprofits to the symphony, she said.

"They're huge," she said. "PGT is very involved with the community. They're very engaged with their hometown."

The company recently was a sponsor of a Venice Chamber awards ceremony, something they have done for years.

She said the company leadership she's interacted with have stressed how they view the community and their employees as family.

"I don't see Jeff Jackson (PGT president and CEO) striking any kind of deal that's going to hurt the employees," she said. "When you look at PGT, they talk about finding your new home with PGT. You become part of the family."

"I don't see them doing anything to hurt the reputation they have built over the years."

She pointed to investments in workforce training and a daycare facility the company built for employees as examples of the company investment in retention.

Instead of spending time worrying about what the merger means for the local business community, Lehner instead chooses to focus on how inspirational the company's success can be viewed by other Sarasota County entrepreneurs.

"To me, it's more of a story of inspiration," she said. "They started as a small business here in Venice and now look what they've accomplished."

Nate Yoder, marketing director for Mullet's Aluminum, also downplayed any potential of a downside in the merger.

Mullet's Aluminum has worked with PGT for decades and was one of the first trade partners for the company, Yoder said.

Yoder said the construction business has been extremely busy in recent years while noting that he views the merger as a positive.

"There's no slow-down. There's no hesitation. There's no signs this building boom is showing any signs of slowing," Yoder said. "Florida is an amazing state and people are moving here in masses."

Yoder called the merger a "great marriage of two great companies."

"The merger strengthens their overall market position," he said. "That is a great merger and we are excited. We were one of PGT's first dealers and we've been consistently one of their largest dealers."

Previous coverage: One of Sarasota County's largest employers targeted for acquisition by Tampa-based company

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This article originally appeared on Sarasota Herald-Tribune: Cost savings expected in first year of $3 billion PGT-Masonite deal