US LBM CEO: full-speed ahead
US LBM this week dropped a significant announcement on the fast-consolidating LBM industry: it would sell three of its operating divisions to ABC Supply’s L&W Supply business.
After more than a decade of steady announcements of acquisitions, the move marked the first significant US LBM announcement of a divestiture — 42 locations in 12 states. But US LBM CEO LT Gibson, via e-mail, told HBSDealer the deal won’t change the company’s drive to build the best “full-line distributor in the industry.”
US LBM and ABC Supply announced Jan. 23 a deal that would bring Feldman Lumber (New York metro); Wallboard Supply (New England) and Rosen Materials (Florida and beyond) under the L&W Supply umbrella.
“With heavy volumes of interior products, including wallboard, acoustical ceilings and steel framing, these three divisions are unique within our portfolio and closely align with the product mix offered by L&W Supply,” Gibson said. He added that US LBM received several unsolicited officers regarding Feldman, Wallboard Supply and Rosen over the past several months.
Gibson said: “Wallboard remains an important product in our portfolio mix and will continue to be available at other US LBM divisions after closing.”
US LBM executed the deal with fast-growing ABC Supply from a position of financial strength, Gibson said, pointing to a record year in 2022 in terms of sales, EBITDA and cash flows.
“We continue to have strong balance-sheet flexibility and remain optimistic about the long-term housing market given the low levels of inventory that exist across the country,” he said. “Proceeds realized from this sale, when completed, will only help to strengthen our already-strong financial position to ultimately execute on our go forward strategies, which include continued strategic acquisitions and greenfield expansions.”
The ABC Supply transaction is subject to customary closing conditions, including regulatory review, and is expected to close in the second quarter of 2023.
US LBM appeared in the number four spot of the latest HBSDealer Top 200 ProDealer Scoreboard, with 2021 sales of $9.22 billion, and 441 units.
“We will continue our approach of capitalizing on the strong relationships of our local divisions and our national network and support teams to provide customers the best service and brands of specialty building products,” Gibson said.
