HD Supply Enters Into Definitive Agreement to Sell its Construction & Industrial–White Cap Business Segment to Clayton, Dubilier & Rice for $2.9 Billion
HD Supply Holdings, Inc. (“HD Supply”) announced that it has entered into a definitive agreement to sell its Construction & Industrial–White Cap business (also known as “White Cap”), a leading distributor of specialty concrete and construction products and services in North America serving professional contractors, to an affiliate of Clayton, Dubilier & Rice for a purchase price of $2.9 billion in cash. Net proceeds from the sale are expected to be approximately $2.5 billion after taxes and transaction costs. The transaction is expected to close in October 2020, subject to customary regulatory approvals.
“After a detailed evaluation, we determined that a sale of our White Cap business unit to Clayton, Dubilier & Rice is in the best interests of our HD Supply stockholders,” said Joe DeAngelo, HD Supply Chairman, President & CEO. “This transaction will enable the HD Supply leadership team to intensify our focus on Facilities Maintenance, while also returning capital to our HD Supply shareholders.”
HD Supply expects to use the net proceeds from this transaction to return capital to HD Supply shareholders, fund M&A activity and repay debt. A more detailed discussion around the use of proceeds will take place on our second-quarter earnings call in early September.
Once the transaction is complete, John Stegeman, White Cap’s current CEO, and Alan Sollenberger, White Cap’s current President, are expected to continue to lead the Construction and Industrial business, which will include the White Cap, Home Improvement Solutions and Brafasco businesses.
Goldman Sachs & Co. LLC served as financial advisor and Jones Day served as legal counsel to HD Supply on the transaction. Debevoise & Plimpton served as legal counsel to CD&R on the transaction.
About HD Supply
HD Supply (www.hdsupply.com) is one of the largest industrial distributors in North America. The company provides a broad range of products and value-add services to approximately 500,000 customers with leadership positions in the maintenance, repair and operations and specialty construction sectors. Through approximately 270 branches and 44 distribution centers in the U.S. and Canada, the company’s approximately 11,500 associates provide localized, customer-tailored products, services and expertise.
About Clayton, Dubilier & Rice
Founded in 1978, Clayton, Dubilier & Rice is a private investment firm. Since inception, CD&R has managed the investment of more than $30 billion in 93 companies with an aggregate transaction value of more than $140 billion. The Firm has offices in New York and London. For more information, visit www.cdr-inc.com.
Charlotte McLaughlin – Investor & Media Contact – firstname.lastname@example.org – (770) 852-9100
Source: HD Supply Holdings, Inc.