Dan Ochstein (left) and Earl Rahn opened NewSouth Windows in the middle of the recession and targeted one of the hardest-hit areas to start their company. "It was an opportunity," Rahn says. Today, NewSouth employs more than 165 people across the state. The windows for all locations are made in Tampa.
NewSouth Window Solution, the zero to $50 million in seven years remodeling success story out of Florida, has been effectively acquired by PGT Innovations (PGTI), a manufacturer and supplier of windows and doors. The two companies have signed a definitive, $92 million in cash agreement expected to be officially complete in early 2020.
In a statement, Jeff Jackson, CEO and president of PGTI, described the decision to acquire NewSouth as a matter of diversification. More specifically, the company likes NewSouth’s “direct-to-consumer channel” in Florida and the market it opens up for them. “The acquisition is expected to provide PGT Innovations with the opportunity to serve a broader residential market segment, primarily driven by replacement projects, and relatively smaller order sizes that PGT Innovations’ strong dealer network typically does not target or serve.”
Since 2015, NewSouth has seen a compounded annual growth rate of approximately 29 percent. The company is expected to reach upwards of $85 million in net sales by this year’s end (a huge leap from eight years ago when the annual revenue was just under $4 million). The company is also expected to retain its existing leadership, including CEO Earl Rahn, who said in a statement: “After successfully executing our growth plan in Florida, we expect this combination to provide growth opportunities to better serve the southern coastal markets and beyond.”
PGTI's acquisition of NewSouth marks another in a growing trend in the home improvement industry that includes Florida Home Improvement Associates acquiring Statewide Remodeling and Restoration Builders acquiring NRC Roofing and Restoration.