Skip to main content
Home
Press Release

Clayton, Dubilier & Rice to Acquire Largest Distributor of Waterworks Products in the U.S.

June 06, 2017

Carve-Out of HD Supply’s Waterworks Division Valued at $2.5 Billion

Clayton, Dubilier & Rice (“CD&R”) today announced an agreement with HD Supply Holdings, Inc. (NASDAQ:HDS) to acquire its Waterworks business unit (“Waterworks”), the nation’s largest distributor of water, sewer, storm and fire protection products, for $2.5 billion. Through a carve-out transaction, Waterworks will become an independent company, wholly-owned by CD&R funds.

Waterworks is a leading U.S. distributor of industrial and construction products used to build and maintain underground water, wastewater and drainage infrastructure networks. The company operates a national network of 244 branches in 46 states with a sales team of more than 1,700 sales representatives serving a diverse customer base of more than 37,000 municipalities, private water companies and professional contractors. Waterworks will continue to be headquartered in St. Louis, Missouri.

Jim Berges, a CD&R Partner, will serve as Chairman of Waterworks. Mr. Berges was Chairman of HD Supply from 2007 to 2015. CD&R invested in HD Supply in 2007 and exited the investment in 2014. Previously, Mr. Berges served as Vice Chairman and President of Emerson Electric Co.

Steve LeClair, who has served as the President of Waterworks since 2011, will become the chief executive officer. “This transaction is an important milestone in the strategic growth of Waterworks,” said Mr. LeClair. “The Waterworks team is very excited to reunite with CD&R to accelerate our growth and productivity initiatives.”

“Waterworks represents an attractive opportunity to invest in the leading distributor in the U.S. waterworks market, which stands to benefit from tailwinds in construction activity and municipal infrastructure spending,” said CD&R Partner J.L. Zrebiec. “With strong national, regional and local positions and a reputation for customer service and reliability, the company is in a very favorable long-term position.”

”Through our prior investment in HD Supply, we have a great appreciation for the strength and quality of the Waterworks business and the exceptionally talented Waterworks management team,” said CD&R Partner Nate Sleeper. “We are very excited to work alongside them once again to continue to build on the company's leading market position and pursue the many significant profitable growth opportunities available to it as a freestanding business.”

CD&R has obtained committed financing from Barclays; BofA Merrill Lynch; Citi; Credit Suisse Securities (USA) LLC; Deutsche Bank AG Cayman Islands Branch; Deutsche Bank AG New York Branch; J.P. Morgan; and RBC Capital Markets, LLC. Barclays; BofA Merrill Lynch; Citi; Credit Suisse Securities (USA) LLC; Deutsche Bank Securities Inc.; J.P. Morgan; and RBC Capital Markets, LLC acted as financial advisors to CD&R. Debevoise & Plimpton LLP served as CD&R’s legal advisor in the transaction.

About Waterworks
Waterworks (www.hdswaterworks.com) is the nation’s largest distributor of water, sewer, storm, fusible piping, and fire protection infrastructure products that serves the needs of both contractors and municipalities in all aspects of the water, wastewater, clean water, landfill, energy, and fire protection industries. Waterworks operates more than 240 branches serving the United States, the Caribbean and the international market. For more information, visit www.hdswaterworks.com.

About Clayton, Dubilier & Rice
Founded in 1978, Clayton, Dubilier & Rice is a private investment firm. Since inception, CD&R has managed the investment of more than $22 billion in 72 companies representing a broad range of industries with an aggregate transaction value of more than $100 billion. The Firm has offices in New York and London. For more information, visit www.cdr-inc.com.

This site uses cookies to provide you with a great user experience. By using this site you accept our use of cookies.