BlackEagle Buys Regional Operations
The platform will act as a holding company for Stock Building Supply's former operations in Wisconsin, New York and Connecticut.
November 4, 2009
BlackEagle Partners, LLC, a Bloomfield Hills, Michigan-based private equity firm launched a new platform company to acquire three regional operations from Stock Building Supply, LLC.
The new platform company, US LBM, will operate as a holding company for the three local operations, which will re-launch using their previous names: Wisconsin Building Supply, Bellevue Builders Supply and East Haven Builders Supply. The businesses are located in Wisconsin, Central New York and Connecticut. BlackEagle will partner with L.T. Gibson, president and chief executive officer of the platform.
Stock Building Supply, a Raleigh, North Carolina-based lumber and building materials distributor, filed for chapter 11 bankruptcy protection in U.S. Bankruptcy Court in Delaware in May. The supplier had about $3.5 billion in sales with an operating loss of $744 million, in the fiscal year ending July 31, 2008.
The transaction comes as many observers believe housing starts and new constructions are likely to rise in the near term. Since January, housing starts have risen 21%, according to a Commerce Department report in late October. Meanwhile, a Reuters survey released during the same period predicted that housing starts would rise to a seasonally adjusted annual rate of 610,000 units in September from 598,000 units in August.
Partners Jason Runco and Harry Watson led the transaction for BlackEagle. Restructuring firm Alvarez & Marsal's transaction advisory group served as the firm’s financial advisor and Honigman Miller Schwartz and Cohn, LLP was BlackEagle’s legal council. Michael DuBay lead the transaction for Honigman.
In a statement, Jason Runco said, “By focusing on smaller markets, the company has a more diverse customer base with less national competition serving both new residential builders as well as professional remodelers.”
In September, BlackEagle agreed to purchase Syracuse, New York-based specialty metals manufacturer Crucible Specialty Metals. In May, the specialty metals plant’s parent company, Crucible Materials Corporation, had filed for bankruptcy protection.
Calls placed to BlackEagle were not returned by press time.
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