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May continued at a strong pace in distribution M&A, with major deals by SunSource and MSC capturing most of the spotlight – except for Staples crashing the Essendant-S.P. Richards party.
A month after Essendant and Genuine Parts entered into an April $680-million merger agreement to combine the office products distributors, Sycamore Partners, Staples’ private-equity owner and owner of about 10 percent of Essendant, made a bid for Essendant shares in May. For now, the Essendant-GPC deal stands.
At a multiple sure to get attention, MSC Industrial Supply Co. (NYSE:MSM), Melville, NY, in May acquired All Integrated Solutions (AIS) from the New York private equity firm High Road Capital Partners. AIS is a distributor of industrial fasteners and components, MRO supplies and assembly tools based in Franksville, WI. The deal has several story lines that add to how the 2018 competitive landscape is shaping up.
Finally, SunSource Holdings, Inc., Addison, IL, a fluid power and motion control distributor in the U.S. and Canada, completed its acquisition of Ryan Herco Flow Solutions from Greenbriar Equity Group in May. SunSource was acquired in late 2017 by private equity firm Clayton, Dubilier & Rice, which last August acquired HD Supply’s Waterworks business unit for $2.5 billion; soon after it renamed the company Core & Main.
SunSource does not report revenues, but MDM ranks the company 25th on our Top 40 Industrial Distributors list for 2017, with estimated revenues in the $500-million range. Ryan Herco also does not report revenues, but was ranked in MDM’s 2017 list as the 28th largest industrial distributor, with more than 30 locations nationally and estimated revenues of more than $200 million.
Here are other key deals that happened in May 2018: