Two closed deals are better than one
Deal Flash | Logistics
Maner Builders Supply Co. (Maner), headquartered in Augusta, GA, has completed two separate but simultaneous transactions.
In addition to the sale of its business operations to US LBM Holdings, LLC (US LBM), a portfolio company of Kelso Private Equity, Maner also sold its real estate to STORE Capital (STORE) in a saleleaseback transaction. Founded in February 1951, Maner is one of the largest independent building supply companies in Georgia, distributing an expansive line of specialty building products to professional homebuilders, contractors and commercial builders from its three locations in Georgia and South Carolina. US LBM, a leading distributor of specialty building materials in the USA, was founded in 2009 with 16 locations in three states. Today, it operates more than 250 sites nationwide. It combines the scale and operational advantages of a national platform with a local go-to-market strategy. STORE, founded in 2011, provides real estate investment trust services and invests in single-tenant real estate. Following the transaction, US LBM will lease back the same properties as a tenant.
The Oaklins team was very organized, technically knowledgeable and experienced. They took care of a lot of challenges that had to be addressed, including COVID-19, and made the transaction progress smoothly. When we were dealing with the buyer the sale price kept changing, but the team was able to adapt to the changes and we were able to settle on a final price and terms with which we are all very happy.JIM BROOME, PARTNER, MANER BUILDERS SUPPLY CO., USA
Market trends & deal drivers
Overall economic trends for the building materials industry have been positive in recent years, driven by persistently low interest rates, stable employment and growing household incomes, all of which have contributed to strong demand for home ownership in the USA, especially in the southeast where population growth has been strong. Recent challenges related to COVID-19 have caused some industry participants to halt or slow down their growth plans in order to assess risks and preserve cash. However, opportunities still exist for M&A activity as the industry remains highly fragmented and expectations are that the COVID-19 crisis will eventually abate.
M&A valuation aspects
Financial details have not been disclosed. Transactions in this sector are typically based on EBITDA multiples of 5–8x, depending on size, profitability, acquisition synergies and various other factors. Attractive acquisitions in this industry are usually companies in growing housing markets with multiple locations, diverse products and service offerings, and strong management teams.
Oaklins’ approach delivers extraordinary value
With its expertise in the logistics and distribution industries, Oaklins’ teams in Jacksonville and Savannah advised Maner Builders Supply Co. and maximized the value of these transactions.
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