Benzinga | Jul 7, 2021 07:08AM EDT

Builders FirstSource Divests Eastern U.S. Gypsum Distribution Operations

Builders FirstSource, Inc. (NASDAQ:BLDR) ("Builders FirstSource"), today announced that it has entered into a definitive agreement to sell the assets of its standalone Eastern U.S. Gypsum Distribution Operations ("Eastern Gypsum Operations") to L&W Supply ("L&W"). L&W will acquire all the assets of the Eastern Gypsum Operations, assume the real estate leases for those operations and hire substantially all of the employees at its locations. ABC Supply acquired Chicago-based L&W Supply in 2016.



Builders FirstSource entered into the gypsum business through the acquisition of Probuild on July 31, 2015. The Company's Eastern Gypsum Operations consist of 21 facilities located throughout the Northeast and Southeast U.S. which generated sales of approximately $160 million in 2020. This divestiture is aligned with Builders FirstSource's long-term strategy and focus on pursuing strategic growth initiatives in its core value-added business. L&W will provide the employees and customers of the Eastern Gypsum Operations with a reliable partner in the space that can provide both employment opportunities and high-quality service.

The sales price of the transaction was not disclosed. The transaction is subject to customary closing conditions and is expected to close in the third quarter of 2021.

Rothschild & Co is serving as financial advisor to Builders FirstSource, and Alston & Bird LLP is serving as its legal counsel.