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Reece Group has announced the acquisition of Southern California plumbing supply wholesaler Todd Pipe & Supply LLC.
Todd Pipe is a strong and well-known business, with six branches in attractive growth areas. The acquisition will complement MORSCO’s existing presence and bring its total number of locations in the region to 23. Todd brings with it a loyal customer base, and a team of experienced leaders.
Privately negotiated, following a period of exclusive due diligence, the acquisition comprises consideration of $122 million, with a further $38 million deferred until Dec. 31, 2021, and subject to achieving milestones.
Todd Pipe delivered an adjusted EBITDA of $18.5 million for the 12 months to March 2019. The existing Todd Pipe management team will join MORSCO and play an important role in the direction of the business and growth in Southern California.
Peter Wilson, CEO and managing director of the Reece Group said of the acquisition, “Todd Pipe is an example of us acting on opportunities to consolidate the fragmented plumbing market in the US Sun-Belt region. We acquired MORSCO last year to create a growth platform for the Group, and we will do this through organic, and considered in-organic opportunities as they arise.”
The acquisition will be cash and debt funded. The transaction is subject to customary closing conditions and is expected to be complete on Oct. 1, 2019.
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