Panolam Industries Completes Acquisition of Nevamar to Form Premier Decorative Laminates Company


HOUSTON (March 1, 2006) – Panolam Industries International, Inc., the North American market leader and innovator in the decorative laminate panel industry, today announced that it has finalized its acquisition of all the outstanding equity securities of Nevamar Holdco, LLC, the parent of Nevamar Company, LLC, a leading manufacturer of decorative surface products. Panolam is a portfolio company of private equity firms Genstar Capital, LLC and The Sterling Group, L.P.

With four manufacturing and six distribution centers located throughout the United States, Nevamar designs and sells decorative laminates and other surfacing materials used in commercial and residential furniture, fixtures, and cabinet markets, as well as the graphic arts industry. Nevamar features brand names including Nevamar(R), Pluswood(TM), Vinylface(TM), Lamclad(TM), and Quinella(TM). In 2005 Nevamar generated estimated revenues of approximately $200 million.

“These are exciting times for all of us at Panolam Industries,” said Robert J. Muller, Jr., chairman, CEO and president of Conn.-based Panolam. “Through innovative products, great design, and a strong distribution network, we look forward to growing all of our brands of high pressure laminates and thermally fused melamine. Incorporating the Nevamar brands into our mix and implementing strategies that have been successful for us will make all the brands stronger and will allow us to capitalize on many new opportunities in North America and around the world.”

“Panolam’s acquisition of Nevamar is a rare opportunity to combine two leading providers of decorative panels,” said Jean-Pierre L. Conte, chairman and managing director of Genstar Capital. “The acquisition will allow the combined business to offer superior products and services to its customers and will enable Panolam’s management team to create significant shareholder value by capturing numerous revenue and cost synergies.”

Genstar Capital and The Sterling Group finalized their acquisition of Panolam on September 30, 2005.

About Panolam Industries International, Inc.
Panolam Industries (www.panolam.com) is a market leader and innovator in the decorative laminate industry. The company’s products, which are marketed under the widely recognized Panolam((R)) and Pionite((R)) brand names, are used in a wide variety of residential and commercial indoor surfacing applications, including kitchen and bath cabinets, furniture, store fixtures, case goods, and other applications. High pressure laminates (HPL), thermally-fused melamine (TFM), fiber reinforced laminate (FRL(TM)), Leatherlam(R), Conolite(R) aircraft laminates, and Panolam’s engineered laminates are utilized as durable and economical alternatives for natural surfacing materials such as wood, stone and ceramic. A typical customer or end-user of decorative overlays might utilize TFM, HPL, FRL(TM) or Leatherlam(R) for different surfaces of the same project. As a vertically integrated manufacturer, Panolam produces decorative surfaces that offer unparalleled quality, variety and flexibility to customers worldwide.

About Genstar Capital, LLC
Based in San Francisco, Genstar Capital (www.gencap.com) is a private equity investment firm that makes leveraged investments in quality middle-market companies. Genstar Capital works in partnership with management to transform its portfolio companies into industry-leading businesses. With more than $900 million of committed capital under management and significant experience investing in businesses, Genstar focuses on selected segments of the life sciences, business services, and industrial technology sectors.

About The Sterling Group, L.P.
The Sterling Group (www.sterling-group.com) is a private equity investment firm founded in 1982 that targets controlling interests in leveraged buyout investments in basic manufacturing, industrial services and distribution companies. Typical enterprise values of these companies range from $100 million to $500 million. Sterling partners with management teams to acquire companies where it has identified specific opportunities to grow and improve the business. Sterling has sponsored the buyouts of 30 portfolio companies and numerous add-on acquisitions for a total transaction value greater than $7 billion. Sterling’s current fund, Sterling Group Partners II, L.P. has $470 million of committed capital.

For additional information:
The Sterling Group, L.P.
Kevin Garland
(713) 877-8257
kgarland@sterling-group.com