Construction supplies company Builders FirstSource Inc. (Nasdaq: BLDR) continues its buying spree with the purchase of Empire Truss Ltd.
Empire is a Huntsville, Texas-based building components manufacturer that operates a 30,000 square foot manufacturing facility in Ferris, Texas, about 20 miles southeast of Dallas. The company's expertise includes custom designed trusses for roofs and floors, as well as distributing engineered wood products. According to Empire, the company's fiscal 2014 sales are estimated to be $11 million.
Casey Collum, co-founder of Empire Truss, will continue to run the company after the deal is completed. Empire will operate under Builders FirstSource and its 56 distribution centers and 53 manufacturing facilities across nine states.
Empire's sale process was brokered by Danny McQuary of Plano, Texas-based financial adviser Note Orius Inc.
The transaction comes amid a spike in M&A among companies specializing in building products and construction. Builders FirstSource, in its own right, has completed a number of deals throughout 2014. Most recently, it took over Trim Tech of Austin Inc., a wholesaler of household interior products. Before that, it acquired Truss Rite LLC, a maker of wood roof and floor trusses, in August. In July, it bought Slone Lumber Co Inc., a Santa Fe-based wholesaler of building materials.
In October, Builders CEO Floyd Sherman said the company will seek additional strategic acquisition targets as confidence in the housing industry and overall economy is restored.
Builders FirstSource is jointly backed by private equity firms Warburg Pincus LLC and JLL Partners since 2006. At the time, Warburg Pincus tapped into its ninth fund to acquire a 26.2 percent beneficial ownership interest in the company from JLL Partners. Additionally, JLL Partners Fund V LP retained ownership of the remaining 26.2 percent beneficial ownership interest.
In September 2009, the two firms proposed to the board of Builders FirstSource a recapitalization of the company, as part of an attempt to lower a mounting debt load.
JLL and Warburg Pincus said they believed that the recap deal wouldl create significant value for all stakeholders of the company.
For coverage on the building materials space, see Experts Corner: Growth in Construction Sector Spurs M&A in Building Products