Distribution Solutions Group‘s subsidiary company, Lawson Products, is set to acquire Source Atlantic Limited. The deal, set to close in Q3 2024 pending regulatory approval, aims to strengthen DSG’s presence in the Canadian MRO market. The acquisition will combine Source Atlantic’s Eastern Canadian operations with DSG’s Bolt Supply’s Western presence, enhancing DSG’s market reach and service capabilities.

Source Atlantic Limited, based in Saint John, New Brunswick, Canada, is a wholesale distributor that offers specialized and technical services.

Terms were disclosed for the transaction, though DSG noted that Source Atlantic generated 2023 fiscal sales of about $183 million USD.

“We are excited to join Distribution Solutions Group to provide best-in-class service and offerings in the Canadian MRO market,” said Steve Drummond, President of Source Atlantic, in the July 10 press release. “We are pleased DSG recognized the value of the platform we have built with Source Atlantic and look forward to growing as a combined company across Canada. Our employees, customers and vendor partners will all benefit from combining Source Atlantic with DSG.”

Lawson Canada serves customers in both the U.S. and Canada.

“We’re thrilled to partner with Source Atlantic to expand DSG’s operating footprint in the Canadian market. Combining Source Atlantic’s Eastern Canadian operation with Bolt Supply’s Western presence positions us as a leading MRO player in the Canadian market, further strengthening DSG’s North American presence for our expanded value-added capabilities,” DSG Chairman and CEO Bryan King said in a July 10 news release.

Cesar Lanuza, President and Chief Executive Officer of Lawson Products, added, “We are excited by the product extensions and geographic locations that Source Atlantic offers in Canadian markets where we do not have much presence today. Similar to Bolt Supply, a wholly-owned subsidiary of Lawson Canada specializing in MRO solutions via branch locations, Source Atlantic offers products and services that deliver world-class business solutions designed to drive customer efficiency. This acquisition leverages the best of both companies with significantly more scale, products and services.”

The transaction will be funded through DCG’s existing cash and credit facility and is expected to be immediately accretive to adjusted earnings per share. The acquisition is not anticipated to materially impact DSGs financial reporting but is posed to deliver substantial strategic value. Lawson Production, a subsidiary unit within the Distribution Solutions Group, is No. 24 MDM’s Industrial Supplies Top Distributors List, and No. 18 for MRO.