EXTON, PA, December 15, 2004 /- The mergers and acquisitions market for plastic building products is percolating these days. Quality companies are being acquired for 8x to 10x trailing EBITDA which still represents value for the buyer of differentiated products with a solid growth horizon. Purchasers of these properties include both strategic and financial buyers who seek product expansions, bolt-on acquisitions, and business or portfolio diversification. A few selected deals over the past couple of years reinforce this trend:

• Quanex acquires vinyl and composite profile extruder Mikron Industries for $205 million in December 2004
• Announced availability of Azek cellular vinyl exterior trim business with the rest of CPG-Vycom
• Style Solutions' recent purchase of Fypon, the leading brand of cast PU foam trim moldings
• Private equity firm Caxton-Iseman Capital acquired Ply Gem in a $570 million deal from building products firm Nortek
• Royal Plastics' purchase of Marley Mouldings, the leading producer in cellular vinyl trim
• Graham Partners' acquisition of Nailite, a leading player in polypropylene panel siding

There are a few specific reasons for this trend. First, a wider acceptance of plastics -- based on aesthetics, performance, and value received -- has led to greater use of plastics in building products. As a result, plastic building products have grown faster (double digit growth) than either plastics (at 2x to 4x GDP growth) or traditional building products (at GDP growth). Continued replacement of natural materials, primarily wood, has accelerated this growth over the past 10 years. Reasons include lower maintenance benefits, possibly lower cost in some applications, and consistent quality and availability, compared to natural materials.

Socio-economic trends have also contributed to the wave of new and innovative plastic building products. These include lifestyle preference for low maintenance, higher real household income levels, the advent of the DIY market, and the redistribution of personal wealth into home property.

The study will provide the following:

• Review the broader plastic building products market in North America and screen the segments that offer the most attractive growth and/or value.
• Identify and profile the most attractive companies participating in the most desirable segments of the overall plastic building products industry.
• Determine which target companies in each segment covered hold greatest opportunity for potential buyers and sellers.

Principia's study entitled INVESTMENT OPPORTUNITIES IN PLASTIC BUILDING PRODUCTS 2005 is available by subscription only and will be published in June 2005. Over 25 key growth and value segments (e.g., cellular vinyl in Exterior Trim) will be further analyzed across the following major plastic building products categories: Decking, Exterior Trim, Fencing, Geomembranes, Insulation, Interior Trim, Pipe/Conduit, Railing, Roofing, Siding, Windows and Doors, and other miscellaneous segments.

Approximately 50 of the leading producers across the most attractive segments will be profiled as possible acquisition candidates. The companies selected will comprise privately held companies as well as divisions or businesses within publicly traded companies. Each company profiled will range in size from approximately $25 million to $250 million in annual revenues.

This report will help business owners, division managers and corporate development executives, among others, to evaluate the most promising acquisition candidates in the most attractive segments of the plastic building products industry. Key subscriber types include:

• Current producers interested in bolt-on acquisitions
• Existing building product companies considering diversification
• Private equity firms considering portfolio expansion
• Direct competitors seeking competitive intelligence

Principia Partners is a leading international business consulting firm, and has extensive experience in building products and plastics industries. In particular, the Firm has closely monitored the market for plastic-based and other synthetic building products over the past 10 years through various research efforts. For more information, visit the Industry Reports section of the Publishing portion of the company's web site at www.PrincipiaConsulting.com. A prospectus of this study is also available by calling Lou Rossi at 484/459-2238.

SOURCE: Principia Partners

Media contact:
Principia Partners
Lou Rossi
800/378-8330 ext. 238 or 484/459-2238
LRossi@PrincipiaConsulting.com