US LBM Announces Joint Ownership Agreement with Bain Capital Private Equity and Platinum Equity

Platinum Equity and existing investor Bain Capital to have equal ownership and shared commitment to support company’s evolution as the most trusted partner to builders across the country

US LBM, a leading distributor of specialty building materials in the United States, announced the signing of a definitive agreement for Platinum Equity to acquire a stake in the company from Bain Capital Private Equity (“Bain Capital”). Bain Capital and Platinum Equity will have equal ownership stakes and joint Board governance. US LBM will continue under the leadership of Founder, President and CEO L.T. Gibson and the current management team. Financial terms of the private transaction were not disclosed.

Founded in 2009 with 16 locations in three states, US LBM has grown into one of the nation’s leading distributors of specialty building materials, operating more than 450 locations throughout the country. The company offers a comprehensive portfolio of specialty products, including windows, doors, millwork, wallboard, roofing, siding, engineered components and cabinetry.

“Our strategy of combining our national scale with a strong local market focus has continued to drive significant growth for US LBM, and Bain Capital’s support has helped accelerate our expansion into several new housing markets while furthering investment in our people, operations and technology to enhance the value we bring to our suppliers, customers and communities,” said Gibson. “US LBM’s national platform, strong supplier relationships, commitment to operational excellence and boosting organic in-market growth continue to make us an acquirer of choice in the building materials industry. We look forward to working with Platinum and our ongoing partnership with Bain Capital. Their combined operational expertise and experience in the building products space will be a significant asset in driving the growth and expansion of our business.”

Platinum Equity Co-President Jacob Kotzubei said he believes in the company’s short and long-term prospects.

“US LBM has built an impressive, diversified business with scale while preserving a vibrant, entrepreneurial spirit,” said Kotzubei. “In the near term, we think the company’s footprint, financial profile, and operating model will allow it to continue growing and strengthening its operations as it navigates the complexities of the current environment. We are optimistic about the outlook for new housing over the long term given the nationwide shortage stemming from years of underbuilding that has created an imbalance in supply and demand. We look forward to working with the company’s leadership group and our partners at Bain Capital to put our financial and operational resources to work.”

Over the last three years, US LBM has approximately tripled sales and profit as a result of an accretive M&A strategy, and investments in data and analytics, supply chain optimization, and customer experience. The company has successfully leveraged its national scale and operations while diversifying its product mix, expanding its structural components manufacturing capabilities and building deep, local customer relationships.

“We are excited to continue our successful collaboration with L.T. and the talented US LBM team.  As the fundamental outlook for new home construction in the U.S. remains strong, we believe the company is poised to further build out its integrated platform through organic growth initiatives and strategic acquisitions,” said Stephen Thomas, a Partner at Bain Capital Private Equity.  “We are proud to have helped US LBM develop a leading national platform and look forward to continuing to support the company in partnership with Platinum, who shares our vision for the growth trajectory of the business.  With our combined resources, US LBM is well-positioned to grow its customer relationships with enhanced product offerings and customer facing technologies,” added Olivia Howard, a Partner at Bain Capital Private Equity.

“There are meaningful opportunities to continue building scale nationally and at the local level,” said Platinum Equity Managing Director Nathan Eldridge. “Our plan is to continue investing in core markets with new product offerings or capabilities, while further expanding the company’s reach geographically. We have a lot of experience investing in building products businesses and believe we are well positioned to support US LBM’s growth.”

Platinum Equity recently signed a definitive agreement to acquire Cook & Boardman, a leading specialty distributor of commercial door and security integration solutions. Other building products companies in the firm’s current portfolio include: JELD-WEN’s Australasia business; Cabinetworks, a leading US manufacturer and distributor of kitchen and bath cabinets; and PGS, a provider of hard surface floor coverings.

The US LBM transaction is expected to close by the end of Q1 2024 and is subject to customary closing conditions, including requisite regulatory approvals.

RBC Capital Markets LLC, Jefferies and Barclays are serving as financial advisors, and Kirkland & Ellis LLP is serving as legal advisor, to US LBM and Bain Capital. Moelis & Company LLC is serving as financial advisor, Gibson, Dunn & Crutcher LLP is providing legal counsel, and Willkie Farr & Gallagher LLP is providing debt structuring counsel to Platinum Equity on the investment in US LBM.

About US LBM

US LBM is the largest privately owned, full-line distributor of specialty building materials in the United States. Offering a comprehensive portfolio of specialty products, including windows, doors, millwork, wallboard, roofing, siding, engineered components and cabinetry, US LBM combines the scale and operational advantages of a national platform with a local go-to-market strategy through its national network of locations across the country. For more information, please visit uslbm.com or follow US LBM on LinkedIn.

About Platinum Equity

Founded in 1995 by Tom Gores, Platinum Equity is a global investment firm with approximately $47 billion of assets under management and a portfolio of approximately 50 operating companies that serve customers around the world. Platinum Equity specializes in mergers, acquisitions and operations – a trademarked strategy it calls M&A&O^® – acquiring and operating companies in a broad range of business markets, including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, telecommunications and other industries. Over the past 27 years Platinum Equity has completed more than 350 acquisitions.

About Bain Capital Private Equity

Bain Capital Private Equity has partnered closely with management teams to provide the strategic resources that build great companies and help them thrive since its founding in 1984. Bain Capital Private Equity’s global team of more than 280 investment professionals creates value for its portfolio companies through its global platform and depth of expertise in key vertical industries including healthcare, consumer/retail, financial and business services, industrials, and technology, media and telecommunications. Bain Capital has 23 offices on four continents. Since its inception, the firm has made primary or add-on investments in more than 1,150 companies. In addition to private equity, Bain Capital invests across multiple asset classes, including credit, public equity, venture capital and real estate, managing approximately $180 billion in total assets and leveraging the firm’s shared platform to capture opportunities in strategic areas of focus. For more information, please visit: https://www.baincapitalprivateequity.com/.

Contact:

Timothy Wirth – Vice President of Communications – Tim.Wirth@uslbm.com

Source: US LBM Holdings, LLC