Griffon Corporation Announces the Acquisition of Pope by AMES Australasia

Rhea-AI Summary

Griffon (NYSE: GFF) announced that its subsidiary, The AMES Companies, acquired Pope from The Toro Company. Pope is an Australian provider of residential watering products. This marks AMES's seventh acquisition in Australia since 2013 and expands its product portfolio in the Australian market. Pope is expected to add approximately $25 million in annual revenue and positively impact Griffon's earnings in the first full year. Financial details of the acquisition were not disclosed.

Positive

• Pope is expected to contribute $25 million in annual revenue.
• The acquisition is AMES's seventh in Australia since 2013, reinforcing its market footprint.
• The acquisition is anticipated to be accretive to Griffon's earnings in the first year.

Negative

• None.

Insights

Financial Analyst

The acquisition of Pope by AMES Australasia, a subsidiary of Griffon Corporation, is a strategic move aimed at expanding Griffon's product portfolio and market presence in Australia. This acquisition is expected to contribute approximately $25 million in annualized revenue and be accretive to the company's earnings in the first full year. For investors, this suggests a positive short-term impact on Griffon's financials, as the immediate revenue boost should reflect positively on the company's earnings reports.

Additionally, this acquisition marks AMES's seventh in Australia since 2013, indicating a strong and targeted growth strategy in the region. This trend of acquisitions could signal to investors that Griffon is committed to expanding its market share and leveraging synergies within its Home and Building Products segment. However, the undisclosed financial terms of the transaction could raise concerns about potential overvaluation or integration costs.

Investors should also consider the broader economic environment and potential risks associated with integrating a new acquisition. If Pope's integration goes smoothly, it could reinforce Griffon's market position. Conversely, any integration challenges could temporarily weigh on the company's performance.

Market Research Analyst

From a market perspective, the acquisition of Pope by AMES Australasia suggests a strategic effort to capture a larger share of the residential watering products market in Australia. Pope is a well-established brand in this niche and its inclusion in AMES's portfolio could enhance AMES’s product offerings and brand recognition in the region. This move could strengthen AMES's competitive position against local and international players in the Australian market.

For retail investors, it's essential to understand the competitive dynamics within the residential watering products market. This sector is characterized by seasonality and regional preferences, which could impact revenue consistency. Nonetheless, Pope's established market presence and brand loyalty are likely advantages that AMES can leverage to achieve steady revenue growth.

Moreover, the acquisition aligns with Griffon's broader strategy of diversifying its portfolio and seeking out growth opportunities. This strategic alignment bodes well for Griffon's long-term growth prospects, provided that it can effectively manage and integrate its acquisitions to realize synergies and operational efficiencies.

NEW YORK--(BUSINESS WIRE)-- Griffon Corporation (NYSE: GFF) (the “Company” or “Griffon”) announced that its subsidiary, The AMES Companies, Inc., (“AMES”) acquired Pope, a leading Australian provider of residential watering products, from The Toro Company (NYSE:TTC). This is AMES’s seventh acquisition in Australia since 2013, and further expands AMES’s product portfolio in the Australian market. Pope is expected to contribute approximately $25 million in annualized revenue and be accretive to Griffon’s earnings in the first full year of ownership. Financial terms of the transaction were not disclosed.

About Griffon Corporation
Griffon is a diversified management and holding company that conducts business through wholly-owned subsidiaries. Griffon oversees the operations of its subsidiaries, allocates resources among them and manages their capital structures. Griffon provides direction and assistance to its subsidiaries in connection with acquisition and growth opportunities as well as in connection with divestitures. In order to further diversify, Griffon also seeks out, evaluates and, when appropriate, will acquire additional businesses that offer potentially attractive returns on capital.

Griffon conducts its operations through two reportable segments:

• Home and Building Products conducts its operations through Clopay Corporation (“Clopay”). Founded in 1964, Clopay is the largest manufacturer and marketer of garage doors and rolling steel doors in North America. Residential and commercial sectional garage doors are sold through professional dealers and leading home center retail chains throughout North America under the brands Clopay, Ideal, and Holmes. Rolling steel door and grille products designed for commercial, industrial, institutional, and retail use are sold under the Cornell and Cookson brands.
• Consumer and Professional Products (“CPP”) is a leading global provider of branded consumer and professional tools; residential, industrial and commercial fans; home storage and organization products; and products that enhance indoor and outdoor lifestyles. CPP sells products globally through a portfolio of leading brands including AMES, since 1774, Hunter, since 1886, True Temper, and ClosetMaid.

For more information on Griffon and its operating subsidiaries, please see the Company’s website at www.griffon.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240630831816/en/

Company:

Brian G. Harris

SVP & Chief Financial Officer

Griffon Corporation

(212) 957-5000

IR@griffon.com

Investor Relations:

Michael Callahan

Managing Director

ICR Inc.

(203) 682-8311

Source: Griffon Corporation

FAQ

What did Griffon (GFF) announce about Pope?

Griffon announced that its subsidiary, The AMES Companies, acquired Pope, an Australian provider of residential watering products, from The Toro Company.

How much revenue will Pope contribute to Griffon (GFF)?

Pope is expected to contribute approximately $25 million in annual revenue.

When is the acquisition of Pope expected to impact Griffon 's (GFF) earnings?

The acquisition is expected to be accretive to Griffon's earnings in the first full year of ownership.

How many acquisitions has AMES made in Australia prior to Pope?

Before acquiring Pope, AMES had made six acquisitions in Australia since 2013.