LANGLEY, BC - Hardwoods Distribution Inc. ("Hardwoods") announced today the acquisition of certain assets (the "Transaction") associated with the business known as Olam Wood Products ("OWP" or the "Business") conducted in Leland, North Carolina. The Business is an importer of high quality tropical lumber and decking material from Africa and South America for resale to industrial customers and wholesale distributors located in North America. Hardwoods also amended its US credit facility concurrently with closing the Transaction.
-- The Transaction is structured as an asset acquisition with a purchase
price of US$2.8 million. Closing date for the Transaction was May 31,
-- The acquired assets consist of inventory and some equipment. Hardwoods
also hired the employees of OWP, and assumed the existing lease of the
Business comprising 40,000 square feet of warehouse and office space in
-- No other liabilities or contractual obligations were assumed by Hardwoods
as part of the Transaction.
-- Hardwoods existing credit facilities were utilized to finance the
purchase price. Hardwoods US operating subsidiary amended its credit
facility to increase maximum borrowings available under the facility from
US$45 million to US$50 million. "The acquisition of the operating assets of OWP is an excellent fit with our growth strategy," said Lance Blanco, President and CEO of Hardwoods. "The acquired Business builds upon Hardwoods well-established strength as an importer of hardwood products by extending our direct sourcing capabilities to tropical lumber products from Africa and South America. The acquisition adds more than $4 million annually to Hardwoods sales, is expected to contribute to current year earnings, and gives us a presence on the US east coast. With an improving US housing market we believe this is a well-timed and well-priced addition to our US branch network," said Mr. Blanco.
About Hardwoods Distribution Inc.
Hardwoods Distribution Inc. (TSX: HWD) is one of North America's largest wholesale distributors of hardwood lumber and related sheet good products, operating a network of 31 distribution centres in the US and Canada.
Source: Hardwoods Distribution Inc.
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