Owens Corning (NYSE: OC), a leader in global building and
construction materials, and Masonite International Corporation
(“Masonite”) (NYSE: DOOR), a leading global provider of interior
and exterior doors and door systems, today announced that Owens
Corning has commenced an offer to exchange (the “Exchange Offer”)
any and all outstanding 3.50% Senior Notes due 2030 issued by
Masonite (the “Existing Masonite Notes”) for new notes to be issued
by Owens Corning as set forth below (the “New Owens Corning
Notes”), in connection with Owens Corning’s anticipated acquisition
of Masonite. In conjunction with the Exchange Offer, Masonite is
soliciting consents (the “Consent Solicitation”) to adopt certain
proposed amendments to the indenture governing the Existing
Masonite Notes (the “Existing Masonite Indenture”) to eliminate
certain of the covenants, restrictive provisions and events of
default from such indenture (collectively, the “Proposed
Amendments”).
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The following table sets forth the amount of the Consent
Payment, Exchange Consideration, Early Tender Premium and Total
Consideration (each as defined below) for the Existing Masonite
Notes:
Title of Series
CUSIP/ISIN Nos. of Existing
Masonite Notes
Maturity Date
Aggregate Principal Amount
Outstanding
Consent Payment(1)(2)
Exchange
Consideration(1)(3)
Early Tender
Premium(1)(2)(3)
Total
Consideration(1)(2)(3)(4)
3.50% Senior
Notes due 2030
144A CUSIP:
575385 AE9
144A ISIN:
US575385AE91
Reg. S CUSIP:
C5389U AM2
Reg. S ISIN:
USC5389UAM20
February 15, 2030
$375,000,000
$2.50 in cash
$970 principal amount of New
Owens Corning 3.50% Senior Notes due 2030
$30 principal amount of New Owens
Corning 3.50% Senior Notes due 2030
$1,000 principal amount of New
Owens Corning 3.50% Senior Notes due 2030 and $2.50 in cash
(1) For each $1,000 principal amount of
Existing Masonite Notes accepted for exchange.
(2) In order to be eligible to receive the
Consent Payment and the Early Tender Premium, Eligible Holders (as
defined below) of Existing Masonite Notes must, at or prior to the
Early Participation Deadline (as defined below), validly tender and
not validly withdraw their Existing Masonite Notes and validly
deliver and not validly revoke their related consents.
(3) The New Owens Corning Notes will
accrue interest from (and including) February 15, 2024, the most
recent interest payment date on which interest has been paid by
Masonite on the Existing Masonite Notes accepted in the Exchange
Offer.
(4) Includes the Consent Payment and the
Early Tender Premium.
Owens Corning and Masonite are making the Exchange Offer and
Consent Solicitation pursuant to the terms of and subject to the
conditions set forth in the offering memorandum and consent
solicitation statement dated May 1, 2024 (the “Statement”).
Any Eligible Holder that validly delivers at or prior to 5:00
p.m., New York City time, on May 14, 2024, unless extended or
terminated (such date and time, as the same may be extended, the
“Early Participation Deadline”), and does not validly revoke at or
prior to the Withdrawal Deadline (as defined below), its consent in
the Consent Solicitation in respect of such Eligible Holder’s
Existing Masonite Notes will be eligible to receive payment in cash
of $2.50 per $1,000 principal amount of such Existing Masonite
Notes accepted for exchange (the “Consent Payment”).
For each $1,000 principal amount of Existing Masonite Notes
validly tendered at or before the Early Participation Deadline and
not validly withdrawn, Eligible Holders of such Existing Masonite
Notes accepted for exchange will be eligible to receive the total
consideration set out in the table above (the “Total
Consideration”), which includes the Consent Payment and an early
tender premium, payable in New Owens Corning Notes, equal to $30.00
(the “Early Tender Premium”).
For each $1,000 principal amount of Existing Masonite Notes
validly tendered after the Early Participation Deadline and at or
before 5:00 p.m., New York City time, on May 30, 2024, unless
extended or terminated (such date and time, as the same may be
extended, the “Expiration Time”), and not validly withdrawn,
Eligible Holders of such Existing Masonite Notes accepted for
exchange will be eligible to receive the exchange consideration set
out in the table above (the “Exchange Consideration”), but not the
Total Consideration, because such Eligible Holders will not be
eligible to receive the Consent Payment and the Early Tender
Premium.
The New Owens Corning Notes will accrue interest from (and
including) February 15, 2024, the most recent interest payment date
on which interest has been paid by Masonite on the Existing
Masonite Notes accepted in the Exchange Offer and Consent
Solicitation; provided that interest will only accrue with respect
to the aggregate principal amount of New Owens Corning Notes an
Eligible Holder receives, which will be less than the principal
amount of Existing Masonite Notes tendered for exchange if such
Eligible Holder tenders its Existing Masonite Notes (and does not
subsequently validly withdraw such Existing Masonite Notes) after
the Early Participation Deadline, which means such Eligible Holder
will receive a lower aggregate interest payment on such Eligible
Holder’s New Owens Corning Notes than the aggregate amount of
interest such Eligible Holder would have received on such Eligible
Holder’s Existing Masonite Notes had such Eligible Holder not
tendered them for exchange in the Exchange Offer.
The New Owens Corning Notes will be issued only in minimum
denominations of $2,000 and integral multiples of $1,000 in excess
thereof. No tender of Existing Masonite Notes will be accepted if
it results in the issuance of less than $2,000 principal amount of
New Owens Corning Notes. If Owens Corning would be required to
issue a New Owens Corning Note in a denomination other than $2,000
or an integral multiple of $1,000 in excess thereof, Owens Corning
will, in lieu of such issuance:
- issue a New Owens Corning Note in a principal amount that has
been rounded down to the nearest integral multiple of $1,000, not
less than the minimum denomination of $2,000; and
- pay a cash amount equal to:
- the difference between (i) the principal amount of the New
Owens Corning Notes to which the tendering holder would otherwise
be entitled and (ii) the principal amount of the New Owens Corning
Note actually issued in accordance with this paragraph; plus
- accrued and unpaid interest on the principal amount
representing such difference to, but excluding, the applicable
Settlement Date (as defined below).
Except as set forth above and for payments made on scheduled
interest payment dates under the terms of the New Owens Corning
Notes, no accrued but unpaid interest will be paid by Owens Corning
with respect to Existing Masonite Notes tendered for exchange and
not validly withdrawn. Scheduled interest payments on Existing
Masonite Notes will continue to be made by Masonite in accordance
with the terms of the Existing Masonite Notes, including while they
are deposited with the Exchange Agent if any such scheduled
interest payment date occurs while they are so deposited. An
Eligible Holder will remain entitled to all interest accrued on the
Existing Masonite Notes during the period such Existing Masonite
Notes are deposited with the Exchange Agent; however, upon
acceptance for exchange by Owens Corning of Existing Masonite Notes
that have been tendered and not validly withdrawn pursuant to the
Exchange Offer, Eligible Holders of such Existing Masonite Notes
will be deemed to have waived the right to receive any payment from
Masonite in respect of interest accrued from the date of the last
interest payment date on which interest has been paid on such
Existing Masonite Notes. No accrued and unpaid interest will be
paid by Masonite with respect to Existing Masonite Notes tendered
and accepted for exchange.
Because the Exchange Offer and Consent Solicitation are subject
to the satisfaction of, among other things, the consummation of the
Arrangement (as defined below), Eligible Holders of Existing
Masonite Notes will not receive the Total Consideration, including
the Consent Payment and the Early Tender Premium, or the Exchange
Consideration, as applicable, unless the Arrangement is
consummated.
Existing Masonite Notes that have been validly tendered may be
withdrawn, and related consents that have been validly delivered
may be revoked, at any time prior to 5:00 p.m., New York City time,
on May 14, 2024, unless extended or terminated (such date and time,
as the same may be extended, the “Withdrawal Deadline”). However,
to be eligible to receive the Total Consideration, including the
Early Tender Premium and the Consent Payment, or the Exchange
Consideration, as applicable, such withdrawn Existing Masonite
Notes must be validly re-tendered and not validly withdrawn, and
the related consents must be validly re-delivered and not validly
revoked, prior to the Early Participation Deadline or the
Expiration Time, as applicable.
Eligible Holders may not deliver consents to the Proposed
Amendments in the Consent Solicitation without tendering Existing
Masonite Notes in the Exchange Offer, and may not tender Existing
Masonite Notes in the Exchange Offer without delivering consents in
the Consent Solicitation.
The “Early Settlement Date” will be, at Owens Corning’s option,
any time after the Early Participation Deadline and prior to the
Expiration Time, subject to the satisfaction or waiver of all
conditions to consummation of the Exchange Offer and the Consent
Solicitation, including the consummation of the Arrangement. If
elected, the Early Settlement Date is expected to occur no earlier
than May 16, 2024. The “Final Settlement Date” will be promptly
after the Expiration Time (expected to be within two business days
after the Expiration Time). We refer to the Early Settlement Date
and the Final Settlement Date as the “Settlement Date,” as
applicable. To the extent any Existing Masonite Notes are not
tendered and accepted in the Exchange Offer and Consent
Solicitation, Owens Corning or Masonite may purchase any
outstanding Existing Masonite Notes in the open market, in
privately negotiated transactions, through one or more additional
tender or exchange offers, by redemption or otherwise.
Masonite is soliciting consents from the Eligible Holders (i) to
the Proposed Amendments to eliminate certain covenants, restrictive
provisions and events of default applicable to the Existing
Masonite Notes and (ii) to the execution and delivery of a
supplemental indenture to the Existing Masonite Indenture,
containing the Proposed Amendments. The consent of the holders of a
majority of the outstanding aggregate principal amount of the
Existing Masonite Notes will be required to give effect to the
Proposed Amendments.
The New Owens Corning Notes will not be guaranteed by any of
Owens Corning’s subsidiaries, including Masonite and its
subsidiaries that guarantee the Existing Masonite Notes. The
Exchange Offer is expected to result in reduced liquidity for the
Existing Masonite Notes and, if adopted, the Proposed Amendments
will remove the restrictive covenants and some other terms of the
Existing Masonite Notes and will afford reduced protection to
holders of those securities. Further, neither Owens Corning nor its
current subsidiaries will have any obligation, contingent or
otherwise, to pay amounts due under the Existing Masonite Notes or
to make any funds available to pay those amounts, whether by
dividend, distribution, loan or other payments. Following the
consummation of the Arrangement, however, Masonite will be a
subsidiary of Owens Corning and will continue to have an obligation
to pay amounts due under the Existing Masonite Notes.
The Exchange Offer and Consent Solicitation are conditioned
upon, among other conditions, the consummation of the pending
acquisition of Masonite by Owens Corning pursuant to the
Arrangement Agreement, dated as of February 8, 2024 (as it may be
amended, the “Arrangement Agreement”), by and among Owens Corning,
MT Acquisition Co ULC, a wholly owned subsidiary of Owens Corning
(“Purchaser”), and Masonite, which condition cannot be waived.
Subject to the terms and conditions of the Arrangement Agreement,
Purchaser will acquire all of the issued and outstanding common
shares of Masonite (the “Arrangement”). The consummation of the
Arrangement is not conditioned upon the successful closing of the
Exchange Offer or Consent Solicitation.
Owens Corning has engaged Morgan Stanley & Co. LLC as Lead
Dealer Manager and Solicitation Agent and Wells Fargo Securities,
LLC as Co-Dealer Manager and Solicitation Agent for the Exchange
Offer. Copies of the Statement may be obtained from Global
Bondholder Services Corporation, the Information Agent and the
Exchange Agent, by phone at (855) 654-2015 (toll-free) or (212)
430-3774 (collect for banks and brokers) or by email at
contact@gbsc-usa.com. Please direct questions regarding the
Exchange Offer to Morgan Stanley & Co. LLC at (800) 624-1808
(toll-free) or (212) 761-1057 (collect for banks and brokers).
The Statement and other documents relating to the Exchange Offer
and Consent Solicitation will only be distributed to Eligible
Holders of Existing Masonite Notes who complete and return an
eligibility form confirming that they are either (a) a “Qualified
Institutional Buyer” as that term is defined in Rule 144A under the
Securities Act of 1933, as amended (“Securities Act”), or (b) a
person that is outside the “United States” and is (i) not a “U.S.
person,” as those terms are defined in Rule 902 under the
Securities Act and (ii) a “non-U.S. qualified offeree” (as defined
in the Statement) (such holders, the “Eligible Holders”). Eligible
Holders of Existing Masonite Notes who desire to obtain and
complete an eligibility form should either visit the website for
this purpose at https://gbsc-usa.com/eligibility/owenscorning or
call Global Bondholder Services Corporation, the Information Agent
and Exchange Agent for the Exchange Offer and Consent Solicitation
at (855) 654-2015 (toll-free) or (212) 430-3774 (collect for banks
and brokers).
The New Owens Corning Notes have not been registered under the
Securities Act or any state securities laws. Therefore, the New
Owens Corning Notes may not be offered or sold in the United States
absent registration or an applicable exemption from the
registration requirements of the Securities Act and any applicable
state securities laws.
About Owens Corning
Owens Corning is a global building and construction materials
leader committed to building a sustainable future through material
innovation. Our three integrated businesses – Roofing, Insulation,
and Composites – provide durable, sustainable, energy-efficient
solutions that leverage our unique material science, manufacturing,
and market knowledge to help our customers win and grow. We are
global in scope, human in scale with approximately 18,000 employees
in 30 countries dedicated to generating value for our customers and
shareholders and making a difference in the communities where we
work and live. Founded in 1938 and based in Toledo, Ohio, USA,
Owens Corning posted 2023 sales of $9.7 billion.
About Masonite
Masonite is a leading global designer, manufacturer, marketer
and distributor of interior and exterior doors and door systems for
the new construction and repair, renovation and remodeling sectors
of the residential and non-residential building construction
markets. Since 1925, Masonite has provided its customers with
innovative products and superior service at compelling values.
Masonite currently serves approximately 6,600 customers
globally.
Forward-Looking Statements
This communication contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements present our current forecasts and estimates of future
events. These statements do not strictly relate to historical or
current results and can be identified by words such as
“anticipate,” “appear,” “assume,” “believe,” “estimate,” “expect,”
“forecast,” “intend,” “likely,” “may,” “plan,” “project,” “seek,”
“should,” “strategy,” “will,” “can,” “could,” “predict,” “future,”
“potential,” “intend,” “forecast,” “look,” “build,” “focus,”
“create,” “work,” “continue,” “target,” “poised,” “advance,”
“drive,” “aim,” “approach,” “seek,” “schedule,” “position,”
“pursue,” “progress,” “budget,” “outlook,” “trend,” “guidance,”
“commit,” “on track,” “objective,” “goal,” “opportunity,”
“ambitions,” “aspire” and variations of negatives of such terms or
variations thereof. Other words and terms of similar meaning or
import in connection with any discussion of future plans, actions,
events or operating, financial or other performance identify
forward-looking statements.
Forward-looking statements by their nature address matters that
are, to different degrees, uncertain, such as statements regarding
the transactions contemplated by the Arrangement Agreement,
including the Arrangement (the “Transaction”), including the
expected time period to consummate the Transaction, the anticipated
benefits (including synergies) of the Transaction and integration
and transition plans, opportunities, anticipated future
performance, expected share buyback programs and expected
dividends. All such forward-looking statements are based upon
current plans, estimates, expectations and ambitions that are
subject to risks, uncertainties, assumptions and other factors,
many of which are beyond the control of Masonite and Owens Corning,
that could cause actual results to differ materially from the
results projected in such forward-looking statements. These risks,
uncertainties, assumptions and other factors include, without
limitation: the expected timing and structure of the Transaction;
the ability of the parties to complete the Transaction; the
expected benefits of the Transaction, such as improved operations,
enhanced revenues and cash flow, synergies, growth potential,
market profile, business plans, expanded portfolio and financial
strength; the timing, receipt and terms and conditions of any
required governmental, court and regulatory approvals of the
Transaction; the ability of Owens Corning to successfully integrate
the operations of Masonite and to achieve expected synergies; cost
reductions and/or productivity improvements, including the risk
that problems may arise which may result in the combined company
not operating as effectively and efficiently as expected; the
occurrence of any event, change or other circumstances that could
give rise to the termination of the Arrangement Agreement; the risk
that the anticipated tax treatment of the Transaction is not
obtained; the risk that the parties may not be able to satisfy the
conditions to the Transaction in a timely manner or at all; risks
related to disruption of management time from ongoing business
operations due to the Transaction; the risk that any announcements
relating to the Transaction could have adverse effects on the
market price of Masonite’s or Owens Corning’s common shares; the
risk that the Transaction and its announcement could have an
adverse effect on the parties’ business relationships and
businesses generally, including the ability of Masonite and Owens
Corning to retain customers and retain and hire key personnel and
maintain relationships with their suppliers and customers, and on
their operating results and businesses generally; unexpected future
capital expenditures; potential litigation relating to the
Transaction that could be instituted against Masonite and/or Owens
Corning or their respective directors and/or officers; third party
contracts containing material consent, anti-assignment, transfer or
other provisions that may be related to the Transaction which are
not waived or otherwise satisfactorily resolved; the competitive
ability and position of Owens Corning following completion of the
Transaction; legal, economic and regulatory conditions, and any
assumptions underlying any of the foregoing; levels of residential
and commercial or industrial construction activity; demand for
Masonite and Owens Corning products; industry and economic
conditions including, but not limited to, supply chain disruptions,
recessionary conditions, inflationary pressures, interest rate and
financial market volatility and the viability of banks and other
financial institutions; availability and cost of energy and raw
materials; levels of global industrial production; competitive and
pricing factors; relationships with key customers and customer
concentration in certain areas; issues related to acquisitions,
divestitures and joint ventures or expansions; various events that
could disrupt operations, including climate change, weather
conditions and storm activity such as droughts, floods, avalanches
and earthquakes, cybersecurity attacks, security threats and
governmental response to them, and technological changes;
legislation and related regulations or interpretations, in the
United States or elsewhere; domestic and international economic and
political conditions, policies or other governmental actions, as
well as war and civil disturbance; changes to tariff, trade or
investment policies or laws; uninsured losses, including those from
natural disasters, catastrophes, pandemics, theft or sabotage;
environmental, product-related or other legal and regulatory
unforeseen or unknown liabilities, proceedings or actions; research
and development activities and intellectual property protection;
issues involving implementation and protection of information
technology systems; foreign exchange and commodity price
fluctuations; levels of indebtedness, liquidity and the
availability and cost of credit; rating agency actions and
Masonite’s and Owens Corning’s ability to access short- and
long-term debt markets on a timely and affordable basis; the level
of fixed costs required to run Masonite’s and Owens Corning’s
businesses; levels of goodwill or other indefinite-lived intangible
assets; labor disputes or shortages, changes in labor costs and
labor difficulties; effects of industry, market, economic, legal or
legislative, political or regulatory conditions outside of
Masonite’s or Owens Corning’s control; and other factors detailed
from time to time in Masonite’s and Owens Corning’s SEC
filings.
All forward-looking statements in this communication should be
considered in the context of the risks and other factors described
above and in the specific factors discussed under the heading “Risk
Factors” in both Masonite’s and Owens Corning’s most recent Annual
Report on Form 10-K filed with the SEC, in each case as these risk
factors are amended or supplemented by subsequent Quarterly Reports
on Form 10-Q and Current Reports on Form 8-K. Masonite’s reports
that are filed with the SEC are available on Masonite’s website at
https://investor.masonite.com/ and on the SEC’s website at
http://www.sec.gov, and Owens Corning’s reports that are filed with
the SEC are available on Owens Corning’s website at
https://investor.owenscorning.com/investors and on the SEC website
at http://www.sec.gov. Any forward-looking statements speak only as
of the date the statement is made and neither Owens Corning nor
Masonite undertake any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law. It is not
possible to identify all of the risks, uncertainties and other
factors that may affect future results. In light of these risks and
uncertainties, the forward-looking events and circumstances
discussed herein may not occur and actual results may differ
materially from those anticipated or implied in the forward-looking
statements. Accordingly, readers are cautioned not to place undue
reliance on any forward-looking statements.
No Offer or Solicitation
This communication is not intended to and does not constitute an
offer to purchase, or the solicitation of an offer to sell, or the
solicitation of tenders or consents with respect to any security.
No offer, solicitation, purchase or sale will be made in any
jurisdiction in which such an offer, solicitation, or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. In the case of the
Exchange Offer and Consent Solicitation, the Exchange Offer and
Consent Solicitation are being made solely pursuant to the
Statement and only to such persons and in such jurisdictions as is
permitted under applicable law.
Owens Corning Company News / Owens Corning Investor Relations
News
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Owens Corning
Amber Wohlfarth VP, Corporate Affairs & Investor Relations
amber.wohlfarth@owenscorning.com 419.248.5639
Megan James Director, Media Relations
megan.james@owenscorning.com 419.348.0768
Masonite
Richard Leland VP, Finance and Treasurer rleland@masonite.com
813.739.1808
Marcus Devlin Director, Investor Relations mdevlin@masonite.com
813.371.5839
Tali Epstein/ Jim Golden/ Jude Gorman Collected Strategies
Masonite-CS@collectedstrategies.com
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