GRAND RAPIDS — Century-old furniture hardware and home organization product maker Knape & Vogt Manufacturing Co. announced Friday that it is being acquired by a Midwest private equity firm, Wind Point Partners. The purchase agreement has Wind Point buying K&V for $19 per share.
According to a company statement, that price represents a 47-percent premium over an average price determined in October 2005, when the company hired an investment banking firm to “evaluate strategic alternatives, including a possible sale of the company.” As NASDAQ trading began Friday, the company’s shares jumped by more than $2, or 13 percent, to settle in the mid-$18 range, a new 52-week high.
In a statement accompanying the announcement, Chairman and CEO Bill Dutmers said he was pleased by the purchase agreement, reemphasizing the burdens that Sarbanes-Oxley and SEC compliance have placed on the 600-employee public firm.
“This is the right opportunity for Knape & Vogt, providing a maximum return for shareholders,” he said. “We have been constrained by our capital structure and the cost burdens of being a publicly traded company, and view this acquisition by Wind Point Partners as an ideal opportunity to invest in the future of this organization.”
The purchase will have to be approved by Knape & Vogt shareholders, as well as passing Wind Point’s scrutiny in the due diligence process. The companies expect the transaction to close within six months.