U.S. Lumber announced today it's getting a "strategic growth investment" from the private equity firm Madison Dearborn Partners (MDP) that will enable the two-step distributor "to execute a strategy of pursuing geographic and product offering expansion."
The size of MDP's investment wasn't disclosed, but the fund has a longstanding record of taking majority ownership when MDP buys into a company. U.S. Lumber's existing management team will remain in place, the Atlanta-based distributor said in a news release.
"The resources and expertise [MDP] bring to our relationship will accelerate our opportunity for product and geographic growth," U.S. Lumber President and CEO Jeff McLendon said in a statement. "Coupling our combined resources with a shared set of values between our two organizations should enhance our supplier relationships and customer offerings while also advancing our growth plans.”
U.S. Lumber serves more than 4,000 pro dealer and retail customers in 23 states from nine distribution centers, eight of them in the Southeast and one in Boston; it acquired Boston Cedar in April 2016. The 19-year-old company says it generates more than $500 million in annual revenue.
Chicago-based Madison Dearborn Partners has invested in more than 130 companies of all types; its current portfolio includes stakes in Univision, Topps (the baseball card company), and LA Fitness. It has invested in Boise Cascade in the past.
U.S. Lumber's push to grow could put it in competition with Cedar Creek. That firm has been one of the most aggressive acquirers among distributors in recent years.