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Category: HD Supply & Clayton, Dubilier & Rice
Date: 17 August 2020 Stock price of HD Supply (HDS): $41.92 We take a look at the press announcement from HD Supply in which it announced that it is selling its construction & industrial segment, White Cap to Clayton, Dubilier & Rice for $2.9 billion. The group states this allows them to focus on their facilities management segment of the business and return cash to stockholders.
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Despite the challenges of the COVID-19 global pandemic, we were still able to achieve a strong start to the year "
More about HD Supply (HDS)
HD Supply (www.hdsupply.com) is one of the largest industrial distributors in North America. The company provides a broad range of products and value-add services to approximately 500,000 customers with leadership positions in the maintenance, repair and operations and specialty construction sectors. Through approximately 270 branches and 44 distribution centers in the U.S. and Canada, the company's more than 11,000 associates provide localized, customer-tailored products, services and expertise.
Press release from HD Supply announcing the sale of White Cap
ATLANTA, Aug. 11, 2020 (GLOBE NEWSWIRE) -- HD Supply Holdings, Inc. (NASDAQ:HDS) ("HD Supply") today announced that it has entered into a definitive agreement to sell its Construction & Industrial--White Cap business (also known as “White Cap”), a leading distributor of specialty concrete and construction products and services in North America serving professional contractors, to an affiliate of Clayton, Dubilier & Rice for a purchase price of $2.9 billion in cash. Net proceeds from the sale are expected to be approximately $2.5 billion after taxes and transaction costs. The transaction is expected to close in October 2020, subject to customary regulatory approvals.
"After a detailed evaluation, we determined that a sale of our White Cap business unit to Clayton, Dubilier & Rice is in the best interests of our HD Supply stockholders,” said Joe DeAngelo, HD Supply Chairman, President & CEO. "This transaction will enable the HD Supply leadership team to intensify our focus on Facilities Maintenance, while also returning capital to our HD Supply shareholders."
HD Supply expects to use the net proceeds from this transaction to return capital to HD Supply shareholders, fund M&A activity and repay debt. A more detailed discussion around the use of proceeds will take place on our second-quarter earnings call in early September.
Once the transaction is complete, John Stegeman, White Cap’s current CEO, and Alan Sollenberger, White Cap’s current President, are expected to continue to lead the Construction and Industrial business, which will include the White Cap, Home Improvement Solutions and Brafasco businesses.
Advisors
Goldman Sachs & Co. LLC served as financial advisor and Jones Day served as legal counsel to HD Supply on the transaction. Debevoise & Plimpton served as legal counsel to CD&R on the transaction.
"After a detailed evaluation, we determined that a sale of our White Cap business unit to Clayton, Dubilier & Rice is in the best interests of our HD Supply stockholders,” said Joe DeAngelo, HD Supply Chairman, President & CEO. "This transaction will enable the HD Supply leadership team to intensify our focus on Facilities Maintenance, while also returning capital to our HD Supply shareholders."
HD Supply expects to use the net proceeds from this transaction to return capital to HD Supply shareholders, fund M&A activity and repay debt. A more detailed discussion around the use of proceeds will take place on our second-quarter earnings call in early September.
Once the transaction is complete, John Stegeman, White Cap’s current CEO, and Alan Sollenberger, White Cap’s current President, are expected to continue to lead the Construction and Industrial business, which will include the White Cap, Home Improvement Solutions and Brafasco businesses.
Advisors
Goldman Sachs & Co. LLC served as financial advisor and Jones Day served as legal counsel to HD Supply on the transaction. Debevoise & Plimpton served as legal counsel to CD&R on the transaction.
Stock price history of HD Supply (HDS) over the last 5 years
The image below shows the stock price history of HD Supply (HDS) over the last 5 years. Over the 5 year period the stock of HDS provided a return of 30.31% to stockholders
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