Lawson Products Canada to acquire Source Atlantic
Distribution Solutions Group, Inc. announced its operating company, Lawson Products, under its affiliate Lawson Products Canada, Inc., has signed an agreement to acquire Source Atlantic Limited.
The transaction is expected to close in the third quarter of 2024.
Source Atlantic, headquartered in Saint John, New Brunswick, Canada, is a wholesale distributor of industrial MRO supplies, safety products, fasteners, and related value-add services for the Canadian MRO market. For the most recent fiscal year, Source Atlantic generated sales of approximately CAD$250 million.
“We’re thrilled to partner with Source Atlantic to expand DSG’s operating footprint in the Canadian market," said DSG Chairman and CEO Bryan King. "We are honored to carry on the company’s successful legacy of over 157 years, dating back to 1867, and to continue its steady stewardship by the Irving family spanning 80 years. 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. We look forward to leveraging the combined operations with the Source Atlantic team and expanding our offerings to their well-established customer base and leveraging their specialty services capabilities which represents approximately one-fourth of their revenues.”
Lawson Products President and Chief Executive Officer Cesar Lanuza 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. Along with our existing Lawson sales representatives in Canada, we will offer a high-touch, specialty distribution platform with the convenience of branch locations now spanning the breadth of the Canadian market, providing a comprehensive, seamless customer experience.”
Source Atlantic President Steve Drummond said, “We are excited to join Distribution Solutions Group to provide best-in-class service and offerings in the Canadian MRO market. 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.”
The transaction will be funded through a combination of DSG’s existing cash and availability under its credit facility and is expected to be immediately accretive to DSG’s adjusted earnings per share.
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