The Heart of the Deals

Ken Clark Editor in Chief

It was a year of intense acquisition activity. The HBSDealer Acquisition Tracker recorded 70 headline-grabbing deals between Jan. 4 ( US LBM-Gilcrest/Jewett) and Dec. 28 (Rocky’s Ace Hardware-Karp’s Hardware).

That’s not counting consolidations among vendors and suppliers. And that’s well above the figure from 2020, during a pre-vaccine pandemic-hindered M&A season.

The experts who dig into the nitty gritty of mergers and acquisitions will tell you that no two acquisitions are the same. It follows, inarguably, that some deals are more interesting and more important than others.

But which deals?

It’s not always possible to watch a recently merged company soar up the stock market as was the case with Builders FirstSource and BMC. (See the location of BLDR all by its lonesome in the top right corner of the Quikrete Industry Dashboards stock chart on page 38).

Happily, there’s another indicator: The HBSDealer Acquisition Tracker Reader Engagement Rankings, based on 2021 pageviews at HBSDealer.com.

Here are the top 10 acquisition stories, along with overall rank: R.P. Lumber; Alexander Lumber (2) Tractor Supply; Orscheln (5) US LBM; Higginbotham Bros. (6) US LBM; ACS. (8) Builders FirstSource; Cornerstone (19) R.P. Lumber; Stock + Field (23) Aubuchon; Delray Plus (24) US LBM; Mid-Cape (26) US LBM; three independents (28) US LBM; Home Center Supply (37)

Some observations

Surprise at the top. With all the private equity money chasing deals, the most-viewed acquisition story of the year was a deal that brought together two family-owned businesses. Alexander Lumber's Watt Alexander shared his take: “Once we decided it was time to make this change, our goal was to find another family-owned company—rather than a private-equity backed competitor,” he said.

Where’s BLDR-BMC? The initial, August 2020 report of the Builders FirstSource-BMC merger would have topped the list in 2021.

With all of the LBM activity, it’s easy to forget the wow-factor of the Tractor Supply acquisition of Orscheln Farm and Ranch when it was announced. With a stroke of a pen, 167 stores in 11 states joined the TSCO team. (You can also see TSCO’s Wall Street performance on page 38.)

Higginbotham Bros. wasn't US LBM's biggest acquisition by a long shot — that would be ACS, which had 70 locations out West, including Meeks Lumber. But Higginbotham generated slightly more engagement. Chalk that up to the Higginbotham history — founded in 1881 — and scope of business that waded US LBM deeper into hardware-and-DIY waters.

Busy buyer: Five of the top 10 acquisition stories of 2021 were orchestrated by US LBM. Seems like a great topic for a cover story. (See page 18.)

HARDWARE + BUILDING SUPPLY HBS

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