SunSource to Acquire United Distribution Group

ADDISON, Ill., July 18, 2018 /PRNewswire/ -- SunSource Holdings, Inc. ("SunSource"), a leading distributor of fluid power and fluid process components and systems in the U.S. and Canada, today announced a definitive agreement to acquire The United Distribution Group, Inc. ("UDG"), a leading distributor of fluid conveyance and related products and services primarily serving maintenance, repair and operations ("MRO") needs across energy, mining and other industrial end markets. Terms of the transaction were not disclosed.

UDG is one of the largest distributors of industrial components and assemblies in North America. With a national footprint often located near high-growth energy markets, UDG combines a comprehensive product offering of over 140,000 SKUs with a suite of value-added services to position the company as a strong partner to its blue chip customer and supplier bases. UDG operates through two subsidiaries: GHX Industrial ("GHX"), a leading distributor of fluid conveyance and sealing products serving upstream energy, downstream energy and diversified markets, and United Central Industrial Supply ("UC"), the leading provider of MRO supplies to underground and surface mining sites and other industrial facilities in North America. The average tenure of UDG's top ten customers exceeds 35 years, and the company leverages its product, application and engineering expertise, value-added service capabilities such as custom fabrication and in-house welding and its long-term, integrated supplier relationships to deliver a superior value proposition to its customers.

"UDG shares many core business strengths and cultural values with SunSource, and the GHX and UC businesses are highly complementary with SunSource's existing business and product portfolio," said David Sacher, CEO of SunSource.  "The combined company will occupy a strengthened position in the marketplace, benefiting from increased scale and an enhanced set of organic and inorganic growth opportunities, particularly in the fluid conveyance market. We believe the combination will drive incremental opportunities to create value for our customers, employees and suppliers, while also accelerating growth, profitability improvement and shareholder value creation."

"We are extremely excited about this important strategic step that will enhance the prospects for both UDG and SunSource," said Darrell Cole, President and CEO of UDG. "Both companies enjoy deep relationships with customers and suppliers, a commitment to value-added capabilities that address complex problems and a talented team of professionals committed to customer satisfaction and a relentless pursuit of continuous improvement."

SunSource has obtained committed financing for the transaction from Barclays, Credit Suisse and Deutsche Bank AG.

Barclays acted as financial advisor and Debevoise & Plimpton acted as legal advisor to SunSource on the transaction, which is expected to close in August. 

Baird served as financial advisor and Akin Gump Strauss Hauer & Field LLP was legal advisor to UDG.

About SunSource
Headquartered in Addison, Illinois, SunSource is a value-added distributor of fluid power and fluid process technologies in the U.S. and Canada. As a technically-focused distributor, SunSource serves as an extension of its customers' design and engineering teams and its suppliers' sales forces, delivering innovative solutions that lower total costs and streamline supply chains. The company operates through four highly focused strategic business units that provide tailored solutions for the unique needs of its Industrial, Mobile, Service & Repair and Process Solutions customers. For more information, visit www.sun-source.com.

About The United Distribution Group, Inc.
The United Distribution Group, through its subsidiary companies, United Central Industrial Supply and GHX Industrial, is one of the largest distributors of industrial supplies in North America. The United Distribution Group is a leading provider of specific and general line products, custom hose fabrication and factory-authorized repair and maintenance services to energy-related and industrial markets, including: oil & gas, mining, power generation, petro-chemical, agriculture, marine and various other related industries. With 60 locations, 2,100 manufacturing partners, and 140,000 SKUs, the UDG family of companies has strategically positioned itself to continue to build upon its unique set of strengths and assets developed over several decades. For more information, please visit www.udginc.com.

Contact: 
Chuck Freeman
630-317-2706

SOURCE SunSource Holdings, Inc.

Related Links

http://www.sun-source.com

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