Distribution Solutions Group, Inc. completed the acquisition of HISCO, Inc. from its employees for approximately $270 million.
June 07, 2023
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Distribution Solutions Group, Inc. entered into a definitive agreement to acquire HISCO, Inc. from its employees for approximately $280 million on March 30, 2023. In connection with the transaction, DSG has agreed to pay $269.1 million at closing, with a potential additional earn-out payment of up to $12.6 million, subject to Hisco achieving certain performance targets. DSG will also pay $37.5 million in cash or DSG common stock in retention bonuses to certain Hisco employees that remain employed with Hisco or its affiliates for twelve or more months after the closing of the transaction. The transaction is unanimously approved by DSG's board of directors and is subject to HSR regulatory approval and customary closing conditions. The transaction is expected to close in the second quarter of 2023. Transaction would be funded using a combination of Distribution Solutions's expanded committed credit facility and approximately $100 million of equity to be raised in rights. It is anticipated that Distribution Solutions's net debt leverage on adjusted EBITDA will be between 3.25x to 3.50x at the time of closing. DSG will combine the operations of TestEquity and Hisco. For fiscal year ended October 31, 2022, Hisco generated sales in excess of $400 million and adjusted EBITDA of approximately $29 million. Piper Sandler & Co. acted as financial advisor and Mayer Brown LLP served as legal counsel to DSG on this acquisition. Greenhill & Co., Inc. (NYSE:GHL) acted as financial advisor to HISCO.
Distribution Solutions Group, Inc. completed the acquisition of HISCO, Inc. from its employees for approximately $270 million on June 8, 2023.
Distribution Solutions Group, Inc. is a specialty distribution company. The Company is engaged in providing value-added distribution solutions to the maintenance, repair and operations (MRO), original equipment manufacturer (OEM) and industrial technology markets. The Company operates through three segments: Lawson, Gexpro Services and TestEquity. Lawson is a distributor of products and services to the industrial, commercial, institutional and governmental MRO marketplace. Lawson primarily distributes MRO products to its customers through a network of sales representatives throughout the United States and Canada. TestEquity is a distributor of test and measurement equipment and solutions, electronic production supplies and tool kits from its manufacturing partners. The Companyâs Gexpro Services is a global supply chain solutions provider, specializing in the development of mission critical production line management, aftermarket and field installation programs.