Business Context and Reporting Period
This Form 8-K, dated June 7, 2026, reports material definitive agreements entered into by Griffon Corporation (GFF) regarding the divestiture of its AMES business units. The filing details the closing of a joint venture for AMES United States and Canada operations and the agreement to form a joint venture for AMES Australasia operations.
Key Financial Metrics and Transaction Terms
AMES North America Joint Venture (Closed June 9, 2026)
- Counterparty: Venanpri Tools (majority owned by ONCAP Management Partners, a subsidiary of Onex Corporation).
- Consideration Received:
- $100 million in cash.
- 42.78% equity interest in the new Buyer entity.
- Second Lien Term Loans (Tranche A and B) totaling $161.1 million principal ($90.0 million Tranche A; $71.1 million Tranche B).
- Debt Terms: The Second Lien Loans bear 10.0% annual interest on a payment-in-kind (PIK) basis, maturing December 9, 2029. No scheduled amortization applies.
- Covenants: Maximum total funded debt to adjusted EBITDA ratio of 4.90:1.00 (stepping down to 4.30:1.00); minimum fixed charge coverage of 1.00:1.00.
AMES Australasia Joint Venture (Agreement Dated June 8, 2026)
- Counterparty: Investment group led by AMES Australasia management (Simon Hupfeld) with Australian financial investors.
- Consideration Received:
- $185 million in cash at closing.
- $50 million subordinated note in the joint venture.
- Ownership Structure: Griffon retains a 49% indirect equity interest; the investment group holds 51%.
Material Changes
The filing represents a significant structural change to Griffon's portfolio, transitioning from full ownership of the AMES North America and Australasia businesses to minority joint venture positions. The North America transaction involves a complex consideration mix including significant debt instruments held by a Griffon subsidiary, while the Australasia transaction provides immediate liquidity and a subordinated note.
Outlook, Risks, and Contingencies
- Real Property Proceeds: Specific real property assets held by the North America JV (located in Florida, Quebec, Pennsylvania, Vermont, and New York) are subject to a "waterfall" repayment structure. Proceeds from the sale of these assets must first repay the Tranche B Loans, then the Tranche A Loans.
- Financial Covenants: The new JV entities are subject to strict financial maintenance covenants, including leverage ratios and fixed charge coverage requirements.
- Representations and Warranties: The filing explicitly states that representations and warranties in the transaction agreements were made solely for the benefit of the parties and should not be relied upon by investors as characterizations of current facts.
Investor Verification Checklist
- Verify the exact closing date and cash receipt confirmation for the AMES Australasia transaction.
- Confirm the accounting treatment of the $161.1 million in Second Lien Loans (Tranche A and B) on Griffon's balance sheet.
- Review the specific terms of the subordinated note ($50 million) in the Australasia JV, including maturity and interest rate.
- Assess the impact of the 42.78% equity stake in the North America JV on consolidated financial reporting (consolidation vs. equity method).
- Monitor compliance with the new debt covenants (4.90:1.00 initial leverage ratio) for the North America JV.