Beacon Roofing Supply, Inc. (BECN - Free Report) has completed the purchase of the leading wholesale distributor of building products, Cassady Pierce Company. The financial terms of the deal are undisclosed.
Earlier in May, Beacon Roofing announced that it would buy Pittsburgh, Pennsylvania-based Cassady Pierce, a privately held leading distributor of residential and commercial exterior building products. Cassady Pierce chiefly caters to professional roofer, remodeling contractor, builder, general contractor and retail home center markets of Western Pennsylvania, Northern West Virginia and the Eastern countries of Ohio.
With the acquisition, Beacon Roofing will be able to expand its business in the unexplored regions of Pennsylvania. Further, it will help the company in augmenting its product portfolio in the lines of its building products.
The acquisition of Cassady Pierce is in line with the aggressive acquisition strategy of Beacon. The company intends to buy market leaders in geographic areas with the intent of expanding its footprint into potential yet unexplored regions.
Recently, Beacon entered into a new five-year senior secured credit facility that includes a $550 million U.S. credit facility and a C$15 million ($15.1 million) Canadian credit facility with Wells Fargo Bank, National Association (WFC - Free Report) .
The credit facility refinanced its previous $515 million credit facility provided through GE Antares and an affiliate. With this new credit facility Beacon Roofing will be able to remain active on its acquisition front. The facility provides the company ample liquidity and financial stability to continue implementing its acquisition strategy.
However, slow recovery in housing starts and weak construction activities have considerably affected the company’s residential as well as non-residential sales volumes across certain regions while Beacon still remains concerned about low corporate profits and tight credit conditions.
Currently, Beacon Roofing retains a short-term Zacks #1 Rank (Outperform). We have a long-term Neutral recommendation on the stock.