Armstrong World sells cabinet business for $27M
NEW YORK (AP) — Armstrong World Industries Inc. said Thursday that it reached a deal to sell its cabinet products business to private equity firm American Industrial Partners for $27 million.
The deal is expected to close in the fourth quarter.
The cabinet business is based in The Colony, Texas, and has manufacturing operations in Thompsontown, Pa. It will operate under the trade name Armstrong Cabinet Products under a two-year license agreement, American Industrial said.
American Industrial said it expects the business to grow as the home construction and remodeling markets continue to recover. It has 750 employees and serves over 3,000 customers through a network of 26 showroom and selection centers, regional distribution facilities and warehouses.
Lancaster, Pa.-based Armstrong World said the sale is in line with its plan to focus on its core floorings and ceilings businesses.
In July, Armstrong said its second-quarter profit rose 10 percent on cost cuts, but it cut its outlook for the year, citing weakening growth in the U.S. and the worsening economy in Europe.
The company said at the time that it expected less opportunity for residential and commercial remodelings and boosted its long-term cost-cutting plan by $15 million to $200 million.
Armstrong shares fell 29 cents to $45.55 in morning trading.