The 2020 Mid-Year Economic Update_long

January M&A Roundup: Momentum Carries into New Year

Wholesale distribution mergers and acquisitions continued at a brisk pace as the calendar rolled over to 2021.
M&A Roundup January 2021

2021 began where 2020 left off — with a slew of M&A deals being announced across wholesale distribution.

The first month of the year included a nice mix of big and small companies, financial and strategic deals, in a variety of categories.

One of January’s most eye-opening deals happened early in the month when Ferguson PLC announced it had agreed to sell Wolseley UK — its UK-based heating and plumbing distribution business — to the private equity firm Clayton, Dubilier & Rice for £308 million (US$417.5 million).

It’s yet another distribution play from CD&R, which bought White Cap from HD Supply and also acquired ERP provider Epicor in late 2020.

Other distributors making strategic moves last month include Applied Industrial Technologies Inc., DXP Enterprises Inc., Hisco Inc., Van Meter, SiteOne Landscape (two acquisitions) and US LBM Holdings.

January Deals

There were many more notable transactions, of course, and in case you missed anything, here are all the M&A announcements — primarily involving distributors but also manufacturers that sell through the channel — MDM covered during the previous month (click the hyperlinked headline for more details):

  • American Securities Closes Acquisition of Foundation Building Materials — Private equity firm American Securities LLC, New York, and specialty building products distributor Foundation Building Materials Inc., Santa Ana, California, announced the closing of American Securities’ acquisition of FBM. American Securities in November agreed to acquire the distributor for $19.25 per share, or $1.4 billion, including outstanding debt.
  • Eaton to Acquire Tripp Lite for $1.7 Billion — Power management company Eaton, Dublin, Ireland, has agreed to acquire Tripp Lite, a Chicago-based power and connectivity solutions provider, for $1.7 billion.
  • Atlas Copco Acquires Italian Distributor — Swedish industrial manufacturer Atlas Copco has acquired DGM SRL (DGM), an Italian distributor of compressed air equipment and related services.
  • Hisco Acquires Kimco — Industrial distributor Hisco Inc., Houston, Texas, has acquired Kimco Distributing Corporation, a Mentor, Ohio-based supplier of products, services and solutions to the manufacturing, testing and repair industries to numerous companies in the Midwest.
  • American Construction Source Acquires Builders Resource Group — American Construction Source, a Springfield, Missouri-based building materials distributor backed by Angeles Equity Partners LLC and Clearlake Capital Group LP, this week announced the acquisition of Builder’s Resource Group, Woodville, Wisconsin.
  • Air Hydro Power to Acquire Uland Supply — Air Hydro Power Inc. (AHP), Louisville, Kentucky, has acquired Uland Supply, also of Louisville. Uland will remain in its downtown location.
  • Beacon Clears Regulation for Divestment of Interior Products Business — Beacon Roofing Supply Inc., Herndon, Virginia, has received early termination of the waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 in connection with the $850 million divestiture of its Interior Products business.
  • Houston Wire & Cable to Sell Southwest Wire Rope Division — Houston Wire & Cable Co., Houston, Texas, has agreed to sell its Southwest Wire Rope business in an asset transaction for $5 million.
  • HVACR Distributor ABCO Acquired by Daikin — ABCO HVACR Supply + Solutions, Long Island City, New York — a full line distributor of HVAC and refrigeration systems and supplies in the Northeastern United States — has been acquired by Houston-based Daikin North America LLC. Daikin is a subsidiary of Daikin Industries Ltd., the Japanese largest manufacturer of heating, cooling and refrigerant products.
  • Material Handling Systems Acquires Conveyor Assets of TGW — Material Handling Systems Inc. (MHS), Washington, Kentucky, will acquire certain U.S. conveyor assets, located in Norton Shores, Michigan, of TGW Logistics Group, Marchtrenk, Austria.
  • Hillenbrand to Sell ABEL Pumps to IDEX — Hillenbrand Inc., Batesville, Indiana, announced that it has agreed to sell Abel Pumps LP to IDEX Corp. for $103.5 million. The sale follows Hillenbrand’s previously announced intent to exit the ABEL business and is expected to be completed in Hillenbrand’s second fiscal quarter.
  • PPG to Acquire Global Coatings Manufacturer — PPG, Pittsburgh, Pennsylvania, has agreed to acquire Wörwag, a Stuttgart, Germany-based manufacturer of coatings for industrial and automotive applications.
  • Heritage Landscape Supply Acquires Ohio Distributor — Landscape distributor Heritage Landscape Supply Group Inc., a McKinney, Texas-based subsidiary of SRS Distribution, has acquired Wolf Creek Co., Trotwood, Ohio, a family-owned distributor of irrigation, outdoor lighting and other landscape products.
  • Houston Wire & Cable Completes Sale of Southern Wire — Houston Wire & Cable Co., Houston, Texas, has completed the sale of its Southern Wire business, an Olive Branch, Mississippi-based wholesale distributor of wire rope and rigging products, to Southern Rigging Companies for $20 million.
  • Atlas Copco Completes Acquisition of Ehrler & Beck — Stockholm, Sweden-based manufacturer Atlas Copco has completed its acquisition of Ehrler & Beck GmbH, originally announced on Nov. 4, 2020.
  • SiteOne Landscape Supply Acquires Stone Center of Virginia — SiteOne Landscape Supply Inc., Roswell, Georgia, has acquired Stone Center of Richmond LLC and Stone Center of Fredericksburg LLC — known collectively Stone Center of Virginia — effective Dec. 31, 2020.
  • Motion & Control Enterprises Acquires Diversified Air Systems — Industrial distributor Motion & Control Enterprises, a Zelienople, Pennsylvania-based portfolio company of the private equity firm Frontenac Co., has acquired Cleveland, Ohio-based Diversified Air Systems.
  • Van Meter Acquires Mid-West Electrical Supply — Electrical distributor Van Meter Inc., Cedar Rapids, Iowa, this week announced that it has acquired Mid-West Electrical Supply Inc., a Wichita, Kansas-based single-branch, electrical distributor, in an asset sale.
  • Atlas Copco Acquires Two Companies — Swedish manufacturer Atlas Copco this week announced two acquisitions — Purification Solutions LLC, a Charlotte, North Carolina-based compressed air and gas solutions provider, and Kawalek Kompressoren, a German-based compressed air distributor and service provider.
  • Distribution International Acquires RB, LLC — Mechanical insulation distributor Distribution International, Inc. (DI) acquired RB LLC, one of North America’s largest marine specialty insulation distributors and fabricators.
  • PPG to Acquire Coatings Manufacturer — PPG, Pittsburgh, has agreed to acquire VersaFlex, a manufacturer specializing in polyurea, epoxy and polyurethane coatings for water and waste water infrastructure, flooring, transportation infrastructure and industrial applications.
  • SiteOne Landscape Acquires Neighboring Georgia Distributor — SiteOne Landscape Supply Inc., Roswell, Georgia, this week announced that it has acquired Dirt and Rock LLC, which is based in Lake Oconee, Georgia, just east of the Atlanta metro area.
  • Applied Industrial Technologies Acquires Automation Company — Applied Industrial Technologies, Cleveland, Ohio, has acquired Gibson Engineering Company Inc. (“Gibson”), a Norwood, Massachusetts-based provider of automation products, services and engineered solutions.
  • Walter Surface Technologies Acquires Drillco and Triumph Twist Drill — Walter Surface Technologies announced the acquisition of two companies, cutting tools brand Drillco, and Triumph Twist Drill, a manufacturer of tooling and drilling solutions.
  • US LBM Acquires Iowa Distributor — Specialty building materials distributor US LBM Holdings LLC, Buffalo Grove, Illinois, has acquired Gilcrest/Jewett Lumber Co., a building products dealer and manufacturer with five locations in Iowa.
  • AD Closes Two Mergers — Wayne, Pennsylvania-based buying group AD has completed mergers with SafetyNetwork and Delta Distributors. The deals mark the group’s 11th and 12th mergers since it started in 1981, and its fourth and fifth in the last two years. Both mergers were effective Jan. 1.
  • CD&R Acquires Wolseley UK from Ferguson — Ferguson PLC has agreed to sell Wolseley UK — its UK-based heating and plumbing distribution business — to the private equity firm Clayton, Dubilier & Rice for £308 million (US$417.5 million).
  • DXP Enterprises Acquires Three Companies — DXP Enterprises Inc., Houston, Texas, has completed three acquisitions — Total Equipment Co., APO Pumps & Compressors (including Corporate Equipment Co.) and Pumping Solutions Inc. DXP funded the acquisitions with cash from the balance sheet.
  • Builders FirstSource, BMC Stock Holdings Complete Merger — Builders FirstSource Inc., Dallas, Texas, and BMC Stock Holdings Inc., Raleigh, North Carolina, have completed their all-stock merger. The close of the merger creates a supplier of building materials and services with combined sales of $11.7 billion and 550 distribution and manufacturing locations in 40 states.
  • Hillenbrand to Sell Red Valve Business to DeZURIK — Hillenbrand Inc., Batesville, Indiana, has completed the sale of its Red Valve business to DeZURIK Inc. for $63 million. The sale follows Hillenbrand’s previously announced intent to exit the business.

Did we miss anything? Please send M&A announcements to editor@mdm.com. We also welcome suggestions for “Behind the Deal,” our occasional series that takes a deep dive into market-shifting moves in wholesale distribution.

Join MDM for Our Virtual M&A Summit

Don’t forget to go register for MDM’s Virtual M&A Summit on Feb. 25. The event will be an informative and engaging look at the entire M&A landscape, including considerations for buyers and sellers, advice on performing due diligence in a pandemic and a macro look at which sectors are projected to see the most consolidation in 2021.

The agenda has been updated, and our latest lineup of presenters and panelists will show you that we’ve gathered the industry’s smartest M&A advisers and operators for a one-day intensive workshop on essential strategies and tactics whether you’re buying or selling.

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