Hardwoods Distribution Inc. (TSX:HWD) has entered into an agreement to purchase the business operations of the Frank Paxton Lumber Company LLC, which makes and distributes hardwood lumber, millwork and architectural sheet goods from five branches located in the U.S.
LANGLEY, B.C.
Hardwoods Distribution Inc. (TSX:HWD) has entered into an agreement to purchase the business operations of the Frank Paxton Lumber Company LLC.
Paxton, which has roots going back to 1914, is a leading remanufacturer and distributor of premium hardwood lumber, millwork and architectural sheet goods from five branches located in Chicago, Cincinnati, Denver, Kansas City, Miss. and San Antonio, Texas.
The transaction is structured as a purchase of assets, which will principally consist of trade accounts receivable, inventory, and equipment. Langley, British Columbia-based Hardwoods won’t acquire any real estate, but will enter into lease agreements covering Paxton’s five operating locations.
The purchase price of the acquired assets is an estimated US$13 million, but will be finalized based upon the value of the acquired assets on the closing date.
Hardwoods existing credit facilities will be utilized to finance the purchase price.
After financing the transaction, Hardwoods expects it will still have sufficient unused borrowing availability under the credit facilities to continue to grow its’ business.
Closing of the transaction was anticipated to occur yesterday subject to satisfaction of final closing conditions by Hardwoods and Paxton.
Hardwoods Distribution Inc., a publicly traded company that holds, indirectly, a 100 per cent ownership interest in Hardwoods Specialty Products LP and Hardwoods Specialty Products US.
Combined it 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 company currently operates a network of 26 distribution centers in Canada and the United States.
DCN NEWS SERVICES
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