Kevin O'Meara, a co-founder of Builders FirstSource (BFS) and its president and COO until his resignation in October 2007, has teamed up with Golden Gate Capital, a $9 billion private equity firm to "explore a range of strategic investments in the building products industry, with emphasis on opportunities in the manufacturing sector," Golden Gate announced Jan. 16.
"We are excited about our partnership with Kevin. In the wake of the unprecedented decline in housing, we believe his blend of operating and strategic experience will make us uniquely qualified to capitalize on significant opportunities in the sector," Rajeev Amara, a managing director of Golden Gate Capital, said in a statement. "The flexible, long-term nature of our fund will give us the unique ability to invest up and down the capital structure, including debt and equity securities. We are confident that our partnership with Kevin will enable Golden Gate Capital to become a leading investor in the building products industry."
O'Meara--listed on Golden Gate's Web site as an "Operating Executive"--was one of BFS' three founders in 1998. He served as its chief financial officer before moving up to become president and COO. His departure in October 2007 came five days after BFS reported its had swung to a net loss of $11.5 million in the third quarter on a 35% decline in sales from 2006's third quarter to $413.9 million. He wasn't replaced.
Conditions at the Dallas-based company have worsened since then. BFS reported third-quarter 2008 net sales fell 30.3% to $288.3 million from $413.9 million in July through September 2007. The company also reported a net loss of $18.9 million for the quarter compared to a net loss of $12 million during the same period last year.
BFS ranked seventh on the 2008 ProSales 100 with 2007 total sales of $1.59 billion. The company operates 61 yards and 59 manufacturing facilities in 11 states.