There have been 33% more acquisitions made by building material suppliers through July 17 when compared to the same time period in 2017. Building material suppliers have made 24 acquisitions accounting for 80 total locations thus far in 2018 compared to 18 acquisitions accounting for 62 locations from January to mid-July in 2017. The number of openings and closures in the industry have increased slightly compared to 2017, with 55 openings and closings through July 17 compared to 50 in 2017 during the same time period.
Of the 24 deals made in 2018 so far, the vast majority have involved specialty dealers. Three of the four biggest deals through July 17 and nearly three-fourths of the total acquisitions have involved specialty dealers. Sixteen of the 24 acquisitions have been made by specialty dealers, resulting in 58 new locations. Acquisitions made by L&W Supply and SRS Distribution account for nearly 50% of the new specialty dealer locations. Lumberyards accounted for five acquisitions resulting in 20 new locations.
L&W Supply’s May 2 acquisition of NexGen Building Supply is the biggest deal to date in 2018, accounting for 15 locations in six different states and the deal grew the drywall and joint compound manufacturer by 10%. Beacon Roofing Supply and Foundation Building Materials were also involved in large multi-state acquisitions in February and July respectively. In the largest deal involving lumberyards, Hammond Lumber purchased all 10 of EBS Building Supplies’ Maine locations in June.
In addition to its acquisition of NexGen Building Supply, L&W Supply also acquired Wright Brothers Supply in California, DeFoor Acoustical Inc. in Georgia, and Ace Supply in Alabama, adding 21 locations in total. ABC Supply, which purchased L&W Supply in 2016, also had a busy start to 2018 by opening nine new locations in seven states while also making three deals to add an additional five locations.
Beacon Roofing Supply, which added 17 new locations in the first half of 2017, purchased Atlas Supply Inc. on July 16 to add six new locations in Washington, Idaho, and Oregon. SRS Distribution, another company which expanded considerably in 2017, opened six new locations in the first half of 2018 and added seven more via acquisitions of Top-Notch Roofing in Texas and Nebraska-based Contractors Siding, Windows, & Roofing Supply.
