Wendt Family Gives Up Control of Jeld-Wen (Portland, Klamath Falls: sale, bankruptcy)

[Cornerguy1]

August 1, 2011 marks the end of an era in Oregon corporate culture.

Onex Corporation (TSX: OCX) announced today that it has amended its previously announced agreement to invest in JELD-WEN Holding, inc., one of the world’s largest residential door and window manufacturers.

Under the amended agreement, Onex and its affiliates will invest $864 million compared to the previously announced $675 million. The Onex group’s investment will be made in two tranches: (i) $675 million of convertible preferred stock representing approximately a 58% ownership stake,

ONEX


The deal also provides for an additional $189 million in the form of a convertible note which may be redeemed within 18 months. The note may only be be redeemed through the sale of approved non-cor assets. If the note is not redeemed, it will convert to further shares in Jeld-Wen which will give ONEX approximately 75% of the Klamath Falls based company.

Rod Wendt, son of the late Jeld-Wen founder Richard Wendt, will be replaced as President of Jeld-Wen by former Masonite International CEO Phillip Orsino.

ONEX will also now appoint 4 of Jeld-Wen's 8 Directors.

[pdxMIKEpdx]

Well it happens, even in Oregon.
I used to work for a Portland grown electronics company.
It got sold to a family in San Francisco.
That family sold it to a NY investment firm.
That firm sold it to another investment firm.
That firm sold it to a huge global conglomerate that also owns Tektronix, Fluke, Mattco and Craftsmen tools, among others.
Last year that company sold it to a British company.
All this happened in the space of ten to twelve years.

The company I worked for is still alive and kicking.
The main difference is that the company "culture" has changed drastically.

From what I hear, it went from a local company staffed solely by Portlanders to a company staffed by people from all over the world.
It also changed from a company with a family atmosphere and an excellent reputation for quality and customer satisfaction to a Dilbert caricature.

[Cornerguy1]

Looks as though that bail out deal with ONEX is far from being a sure thing. ONEX is apparently insisting that Jeld-Wen flog $575 million dollars in private junk bonds as a condition of the deal closing in September.

Standard and Poors rating service has classified the bonds as CCC; S&P also reports Jeld-Wen is carrying $1.2 billion in debt.

Jeld-Wen, burdened by debt, peddles junk bonds to prepare for Onex bailout | OregonLive.com


In a related story, OregonLive reports numerous retired Jeld-Wen employees have had not received promised pension payments.

The story also identifies gross mismanagement as a contributing factor to the Klamath Falls based companies financial struggles.

Revamped Jeld-Wen deal leaves some fuming as Oregon's largest privately held company hands control to Canada's Onex | OregonLive.com


The big question is what happens if the leery bond market doesn't permit the ONEX bail out to go through.

It looks as bankruptcy could be a real possibility for Oregon's largest private company.

[Dual Citizen CA-OR]

Does this mean we get our baseball team back?!?