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Breaking news in Wholesale Distribution
After months of speculation, The Home Depot has agreed to sell its wholesale division, HD Supply, and bring its focus back to the performance of its retail core. Three private equity firms will buy the $12 billion unit.
The Home Depot, Atlanta, GA, has agreed to sell HD Supply to a team of private equity firms – Bain Capital LLC, Carlyle Group and Clayton Dubilier & Rice Inc. – for $10.3 billion, or roughly 10X-12X EBITDA. The firms are splitting the investment equally.
The sale has been expected for weeks now, with a number of private equity firms rumored to have bid for the unit and several to have bowed out due to the down housing market – one of HD Supply's core customer bases. HD Supply reported a decrease in organic sales in the recent …
Nucor Corp., Charlotte, NC, has agreed to buy Magnatrax Corporation, a provider of metal building systems in the North American non-residential market, for $280 million.
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Magnatrax has seven fabricating plants, as well as service centers and transport facilities, throughout the U.S. It operates through its American Buildings Company, Kirby Building Systems, Gulf States Manufacturers and CBC Steel Buildings subsidiaries and divisions.
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The supplier sells, engineers and fabricates custom metal roofing systems for new and retrofit construction and sells third-party metal building components.
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The acquisition of Magnatrax is an important growth opportunity for one of our core downstream businesses,” said Dan DiMicco, Nucor’s president and CEO. …
Wholesalers posted sharply lower sales in April, as declines in a number of major sectors erased all of the strong gains made over the previous two months.
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Overall sales fell by 3.1% in April to an estimated $42.8  ; billion. April’s drop was the largest since August  ; 2003  ; and followed increases of 2.3% and 0.9% in March and February respectively.
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Five of the seven wholesale sectors registered declines in April. Leading the way was the automotive products sector (-8.3%), followed by other products” (-5.9%) and machinery and electronic equipment (-2.3%). Sales of building materials and farm products also posted decreases in April.
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The only positive note came in the food, beverage and tobacco products sector (+0.8%), while sales …
SKF has acquired Baker Instruments Company, Fort Collins, CO, a manufacturer of test and diagnostic instruments for electric motor assessment. Baker has sales of $11 million.
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This move into electric motor diagnostics is important to our new Energy Efficiency solutions business, and is in line with the SKF Group’s move towards supporting our customers in their Sustainability efforts,” said Phil Knights, president, SKF Service Division.
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Baker’s sales are mainly focused on the industrial motor users in the U.S.
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SKF paid $14 million for the company. Baker will be part of SKF Reliability Systems within the Service …
Hagemeyer, Naarden, the Netherlands, announced that Rudi de Becker will resign as CEO and chairman of the Board of Management of Hagemeyer at the next annual general meeting of shareholders in April 2008.
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Hagemeyer said that De Becker wants to spend more time with his family.
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Commenting on the resignation of de Becker, Adri Baan, chairman of the Supervisory Board said: Rudi de Becker joined Hagemeyer after a period of financial difficulties and he has made a significant contribution to Hagemeyer’s recovery. We regret but respect his decision and we trust that a suitable successor will be found.”
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Hagemeyer is a distributor of electrical parts and supplies, safety and other MRO products in 25 countries in Europe, North America and …
HD Supply’s new owners said that it is premature to say whether they will divest any of the $12 billion distributor’s assets after taking full ownership, said David Novak, a partner at Clayton Dubilier & Rice, one of the three private equity firms that have agreed to buy the unit from The Home Depot Inc. for $10.3 billion.
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Bain Capital LLC, Carlyle Group and CD & R are splitting the investment evenly, Novak said.
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Though there are no immediate plans for HD Supply’s current assets, the new owners do plan to continue building the company through acquisitions. That we will certainly do,” Novak told MDM. “Local scale is very important for productivity and service levels.”
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That means that HD Supply, with $12 billion in sales in 2006, will continue …
Schneider Electric has entered into exclusive negotiations with diversified industrial manufacturer Eaton Corp. for the divestment of MGE UPS Systems. The expected move is to fulfill a commitment to the European Commission following the acquisition of American Power Conversion.
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Eaton is offering 425 million euros (US$569 million) for the business, which had revenues of 156 million euros (US$209 million) in 2006.
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MGE UPS Systems, a Schneider subsidiary, is a supplier of a full range of equipment: uninterruptible power supplies, static transfer switches, harmonic filters and advanced power management solutions. It has customers in more than 100 …
VWR International, Inc., West Chester, PA, a supplier to the global research laboratory industry, has agreed to acquire Bie & Berntsen A-S, a Danish scientific laboratory supply distributor.
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Bie & Berntsen is one of Denmark’s largest suppliers of chemical and laboratory equipment with 90 employees, all in Denmark. The company has annual revenues of US$27 million.
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Manuel Brocke-Benz, VWR senior vice president and managing director of European operations, said: The combination of VWR International and Bie & Berntsen is a perfect fit. VWR’s expertise in chemicals, consumables and life science products, combined with Bie & Berntsen’s emphasis on instruments, equipment and technical service, will enhance our product and service offerings to our customers and …
Home Depot’s announcement that it is selling its wholesale division HD Supply for $10.3 billion to a trio of private equity firms -Bain Capital, Carlyle Group and Clayton Dubilier & Rice -is hardly a surprise, given the media coverage that led up to it. Though we don’t know all the details yet, there are already a few takeaways from the news:
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1. As Grainger President and COO Jim Ryan said in mid-May (Grainger: Consolidation is Changing Marketplace), just because HD Supply has been been sold does not mean that it disappears as a player in the market. Still, HD Supply’s new owners will have the same …
Home Depot CEO Frank Blake said Wednesday that selling HD Supply in pieces would have been  ; time-consuming and  ; distracting, with an added cost of separating the businesses. An IPO would have resulted in a multiple discount relative to the sale of the entire business.
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This was not an easy decision,” Blake said about the announcement Tuesday that Home Depot would sell its $12 billion wholesale division in its entirety for $10.3 billion to a group of three private equity firms. “(HD Supply chief) Joe DeAngelo and his team have built a world-class operation over the last few years. We gave careful consideration to a number of options, including holding onto the business.”
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The three private equity firms buying HD Supply for roughly 10X-12X EBITDA are …
