Advent International Strikes a $1 Billion Deal to Sell Distribution International

Private equity firm Advent International is selling off Distribution International to TopBuild in an all-cash deal.
File folder with Merger and Acquisition and financial graphs.

Private equity firm Advent International announced on Wednesday that it has entered into an agreement to sell Distribution International Inc. (DI) to TopBuild Corp. (NYSE:BLD) in an all-cash transaction valued at $1 billion.

TopBuild, an installer and distributor of insulation and building material products to the U.S. construction industry, expects to fund the acquisition using a combination of debt financing and cash on hand.

Founded in 1986, DI is a specialty distributor and custom fabricator of mechanical insulation and related accessories for industrial and commercial end-markets. Under the auspices of Advent, DI solidified its position as the largest player in the $5 billion mechanical insulation market, according to Wednesday’s press release.

During that time, DI expanded into new product categories, including metal building insulation, broadened its end-market focus in areas such as marine and data centers, and developed digital tools for its customers. It also completed 11 acquisitions, adding new geographies while broadening its product portfolio.

“We are proud of what we’ve achieved working with Advent and are grateful for their support and expertise, which has been instrumental to our growth,” said Steve Margolius, President and Chief Executive Officer of DI. “As we take this next step, we’re eager for the new growth opportunities our partnership with TopBuild offers, underpinned by a strong, shared commitment to people, safety, and service. We look forward to working with them to continue our momentum and even better serve the needs of our customers.”

Under Advent, DI’s footprint grew by nearly 50 locations, to 101 branches across the U.S. and Canada, and its revenue grew by more than 50%, to approximately $747 million for the trailing 12 months ended June 30, 2021, on a pro forma basis.

“The acquisition of Distribution International is highly strategic for TopBuild,” said TopBuild President and CEO Robert Buck . “It aligns with our strategy of seeking well-managed companies with experienced, talented teams with expertise in our core business of insulation and adjacent products. DI provides us with a direct entry and immediate leadership position in the $5 billion mechanical insulation market, which is a highly attractive and complementary new growth platform for TopBuild.”

The deal, which has been approved by TopBuild’s board of directors, is subject to regulatory approval and other customary closing conditions. It’s slated to close in the fourth quarter of 2021.

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