Hardwoods Distribution completes acquisition of Frank Paxton Lumber
September 19, 2011
– Hardwoods Distribution Inc. ("Hardwoods") announced today it has completed its previously announced acquisition (the "Acquisition") of the Frank Paxton Lumber Company LLC ("Paxton"). Paxton is a leading remanufacturer and distributor of premium hardwood lumber, millwork and architectural sheet goods, with branch operations located in Chicago, Cincinnati, Denver, Kansas City and San Antonio. The Acquisition was structured as a purchase of assets, principally trade accounts receivable, inventory, and equipment. The purchase price of the acquired assets on the closing date was US$13.9 million.
"We are pleased to have successfully completed the acquisition of Paxton, one of the hardwood industry's premiere distributors," said Lance Blanco, President and CEO of Hardwoods. "We are impressed with the high quality of people and operations that comprise the Paxton business. The Frank Paxton Lumber Company is an excellent fit with Hardwoods market expansion strategies, and we welcome and look forward to working with our new Paxton employees."
Hardwoods also announced today an amendment (the "Amendment") to the revolving credit facility available to its U.S. operating subsidiary, Hardwoods Speciality Products USLP ("Hardwoods USLP"). The Amendment provides the consent of Hardwoods USLP's lender to the Acquisition. The Amendment also increases the maximum borrowings available to Hardwoods USLP under the credit facility, from US$25 million to US$30 million. Increasing the size of the credit facility provides Hardwoods USLP with additional flexibility to borrow against the value of collateral expected to arise from the purchase of the business operations of Paxton.
About Hardwoods Distribution Inc.
Hardwoods Distribution Inc. ("Hardwoods") (TSX: HWD) is a publicly traded company that holds, indirectly, a 100% ownership interest in Hardwoods Specialty Products LP and Hardwoods Specialty Products US LP (collectively, the "Business"). The Business is one of North America's largest distributors of high-grade hardwood lumber and sheet goods to the cabinet, moulding, millwork, furniture and specialty wood products industries. The Business currently operates a network of 31 distribution centers in the U.S. and Canada.