DXP Enterprises, Inc. Announces Strategic Acquisitions
January 04 2021 - 8:30AM
Business Wire
- Two Leading Pump and Air Compressor Distributors Serving the
Ohio River Valley Region
- Leading California Pump Distributor Serving the Chemical and
Water /Waste Water Markets
- Attractive Aftermarket and Service Capabilities
- Expected to Accelerate End Market Diversification
- Attractive Growth Opportunities, Accretive to Margins, Cash
Flow and Returns
DXP Enterprises, Inc. (NASDAQ: DXPE) today announced that
it has completed the acquisitions of Total Equipment Company
(“TEC”), APO Pumps & Compressors including Corporate Equipment
Company (together “APO/CEC”) and Pumping Solutions, Inc. (“PSI”).
Financial terms of the transactions were not disclosed. DXP funded
the acquisitions with cash from the balance sheet.
“We are pleased to announce these acquisitions, as each company
provides DXP with exceptional management teams that enhance our
ability to collaborate and serve our customers, vendors and other
stakeholders. Total Equipment and APO enhance our aftermarket and
service capabilities along with furthering our end market
diversification efforts. Pumping Solutions and CEC provide DXP with
a growing and deepening presence into the water and wastewater
market as well as other commercial and industrial end markets. We
believe these acquisitions provide a repeatable and sustainable
earnings profile that is complementary to our business and
consistent with our strategy,” said David Little, Chairman and CEO
of DXP Enterprises. “We welcome the employees of these companies to
the DXP family. These acquisitions provide great opportunities for
DXP and provide new opportunities for our vendors, customers and
employees to grow with us going forward,” concluded Mr. Little.
Signing of the definitive agreements occurred on December 31,
2020. Sales and adjusted EBITDA were approximately $114 million and
$16 million, respectively for the eleven months ended November 30,
2020. Adjusted EBITDA was calculated as income before tax, plus
depreciation and amortization, and non-recurring items.
Kent Yee, CFO added, “We continue to execute on our strategic
priorities and strategy of making acquisitions in markets and
business models where we can continue to enhance DXP. In today’s
market, we were able to not only accomplish our goals but also do
it on favorable terms. We are adding over 269 talented employees to
the DXP team and we look forward to our growth together. Combined,
these acquisitions complement DXP while diversifying our products,
services and end mark exposure. We expect this set of transactions
to reduce our oil & gas exposure by 200-400 basis points while
adding strong recurring revenue fueled by meaningful aftermarket
and service capabilities. Additionally, we are adding scale to key
end markets like water and waste water, chemical and food &
beverage. We anticipate these acquisitions to be accretive to
earnings.”
About DXP Enterprises, Inc.
DXP Enterprises, Inc. is a leading products and service
distributor that adds value and total cost savings solutions to
industrial customers throughout the United States, Canada and
Dubai. DXP provides innovative pumping solutions, supply chain
services and maintenance, repair, operating and production ("MROP")
services that emphasize and utilize DXP’s vast product knowledge
and technical expertise in rotating equipment, bearings, power
transmission, metal working, industrial supplies and safety
products and services. DXP's breadth of MROP products and service
solutions allows DXP to be flexible and customer-driven, creating
competitive advantages for our customers. DXP’s business segments
include Service Centers, Innovative Pumping Solutions and Supply
Chain Services. For more information, go to www.dxpe.com.
The Private Securities Litigation Reform Act of 1995 provides a
“safe-harbor” for forward-looking statements. Certain information
included in this press release (as well as information included in
oral statements or other written statements made by or to be made
by the Company) contains statements that are forward-looking. Such
forward-looking information involves important risks and
uncertainties that could significantly affect anticipated results
in the future; and accordingly, such results may differ from those
expressed in any forward-looking statement made by or on behalf of
the Company. These risks and uncertainties include, but are not
limited to; ability to obtain needed capital, dependence on
existing management, leverage and debt service, domestic or global
economic conditions, and changes in customer preferences and
attitudes. In some cases, you can identify forward-looking
statements by terminology such as, but not limited to, “may,”
“will,” “should,” “intend,” “expect,” “plan,” “anticipate,”
“believe,” “estimate,” “predict,” “potential,” “goal,” or
“continue” or the negative of such terms or other comparable
terminology. For more information, review the Company’s filings
with the Securities and Exchange Commission.
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version on businesswire.com: https://www.businesswire.com/news/home/20210104005178/en/
Kent Yee Senior Vice President CFO 713-996-4700 –
www.dxpe.com
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