Pair of Acquisitions Highlight Continuing Strength of Building Materials Distribution Market

The US building construction market continues to remain a strong point for the US economy, even as the industry is plagued by shortages of lumber, supply chain issues, and surging demand for products – providing a challenge to retailers to keep needed products in stock. However, continuing demand for new homes and heightened homeowner interest in renovation projects have meant that distributors and retailers catering to the needs of construction professionals have seen brisk business. A pair of recent transactions demonstrates the strength of the building materials distribution segment.

The first – Builders FirstSource’s announced acquisition of Cornerstone Building Alliance SW – will not only add more than $300 million in annual sales to Builders FirstSource’s revenues, but will also greatly expand its presence in the growing Arizona market. Cornerstone Building Alliance is one of the largest building materials retailers in the state of Arizona, serving both residential and commercial customers in the state’s largest markets. Indeed, subsequent to the transaction, Builders FirstSource will be the third-largest retailer of building materials in the US, with over $13 billion in annual sales.

The second – US LBM’s agreement to acquire American Construction Source – will boost US LBM’s market presence in a number of states in the Midwest and West regions of the US. American Construction Source, which reportedly has more than $700 million in annual sales, operates more than 70 sales outlets nationwide, primarily serving custom home builders and contractors specializing in home repairs and renovations. With this purchase, US LBM will further cement its position as a top ten retailer of building materials in the US.

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