Closed Merger/Acquisition Transaction – Target: B27, LLC; Buyer(s): DXP Enterprises, Inc.; Seller(s): Audax Group, Inc., B27 Holdings Corp., B28 Investment Fund, LLC, Champlain Capital Management, LLC, Gulfstar Merchant Banking III, Ltd., Honeywell International Inc. Master Retirement Trust, Madison Capital Funding Co-Investment Fund LP, Roynat Merchant Capital Inc., Stockwell Capital LLC; Transaction Size: $326.36 mm
January 02, 2014
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DXP Enterprises, Inc. (NasdaqGS:DXPE) entered into a definitive agreement to acquire B27, LLC from Champlain Capital Partners, L.P., a fund of Champlain Capital Management, LLC, Stockwell Fund II, L.P., a fund of Stockwell Capital LLC, Stephen Ardia, Audax Mezzanine Fund II, L.P., a fund of Audax Group, Inc., Gulfstar Merchant Banking III, Ltd., B28 Investment Fund, LLC, Roynat Merchant Capital Inc., Honeywell International Inc. Master Retirement Trust, Madison Capital Funding Co-Investment Fund LP and B27 Holdings Corp for approximately $280 million on December 9, 2013. In connection with the closing of the acquisition, DXP will enter into an amended and restated credit agreement with Wells Fargo Bank, National Association to amend the existing credit facility. The new facility will provide a $250 million term loan and a $350 million revolving line of credit facility and approximately $3 million of DXP common stock. B27 reported sales of $142 million for the year 2012.
The transaction is subject to the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions. The deal is expected to close during the first quarter of 2014. The transaction is expected to be accretive to earnings for fiscal 2014 between $0.5 to $0.55 per share. Houlihan Lokey Capital, Inc. acted as the financial advisor to B27, LLC. Paul Sewell and Cameron Dee Sewell of Krage & Janvey LLP acted as the legal advisors to B27, LLC while Brian Fenske of Norton Rose Fulbright LLP acted as the legal advisor to DXP Enterprises, Inc. Stephen M. Fields of Dentons US LLP acted as legal advisor to B27 Holdings Corp.
DXP Enterprises, Inc. (NasdaqGS:DXPE) completed the acquisition of B27, LLC from Champlain Capital Partners, L.P., a fund of Champlain Capital Management, LLC, Stockwell Fund II, L.P., a fund of Stockwell Capital LLC, Stephen Ardia, Audax Mezzanine Fund II, L.P., a fund of Audax Group, Inc., Gulfstar Merchant Banking III, Ltd., B28 Investment Fund, LLC, Roynat Merchant Capital Inc., Honeywell International Inc. Master Retirement Trust, Madison Capital Funding Co-Investment Fund LP and B27 Holdings Corp on January 2, 2014.
DXP Enterprises, Inc. is a products and service distributor that offers solutions to industrial customers. It provides pumping solutions, supply chain services and maintenance, repair, operating and production (MROP) services. It has three segments: Service Centers (SC), Innovative Pumping Solutions (IPS) and Supply Chain Services (SCS). SC segment is engaged in providing MRO products, equipment and services, including technical expertise and logistics capabilities, to a variety of customers serving varied end markets with the ability to provide same day delivery. IPS segment provides integrated, custom pump skid packages, pump remanufacturing and manufactures branded private label pumps. SCS segment provides fully outsourced MRO solutions for sourcing MRO products, including inventory optimization and management, storeroom management, transaction consolidation and control, vendor oversight and procurement cost optimization, productivity improvement services, and customized reporting.
DXP ENTERPRISES, INC. 
