Builders FirstSource to buy privately held rival ProBuild Holdings for $1.63 bn

US supplier of residential building products Builders FirstSource Inc, yesterday struck a deal to buy privately-held rival ProBuild Holdings for $1.63 billion in cash.

ProBuild is owned by Devonshire Investors, the private-equity arm of Fidelity Investment.

With around $4.5 billion in revenue in 2014, ProBuild is one of the largest distributors of building materials to professional builders, contractors and project-oriented consumers in the US.

The Denver, Colorado-based company operates lumberyards, component facilities, millwork shops, gypsum yards and retail stores across 40 states.

Builders FirstSource said that the acquisition will give it an enhanced portfolio of products, including lumber, windows, doors, millwork, hardware, roof and floor trusses, engineered wood products, gypsum, roofing, metal and concrete products, cabinets and countertops.

The deal is expected to generate $100 million to $120 million in annual cost savings.

Texas-based Builders FirstSource is a leading supplier and manufacturer of structural and related building products for residential new construction.

The company operates 56 distribution centers and 56 manufacturing facilities in nine states, principally in the southern and eastern US. Its manufacturing facilities include plants that manufacture roof and floor trusses, wall panels, stairs, aluminum and vinyl windows, custom millwork and pre-hung doors.

Builders FirstSource also distributes windows, interior and exterior doors, dimensional lumber and lumber sheet goods, millwork and other building products.

Floyd Sherman, CEO of Builders FirstSource, said, "We are very pleased to announce this compelling combination with ProBuild to create a more diversified company with enhanced scale and an improved geographic footprint that will drive significant value for our customers and stockholders.''