Advent International has agreed to sell MORSCO, a U.S. distributor of plumbing products, waterworks materials, and heating and cooling equipment, to Reece Limited, a similar leading distributor in Australia. Reece will acquire MORSCO for US$1.44 billion in cash. Reece intends to operate MORSCO separately from its businesses in Australia and New Zealand, with the existing MORSCO management team remaining in place under the leadership of CEO Chip Hornsby.
MORSCO is a private company owned by Advent since November 2011 and led by a team of industry veterans. Today the company has 171 branches in 16 states, with coast-to-coast coverage of the fast-growing Sun Belt region of the U.S.
“We are proud of our successful partnership with MORSCO,” said Stephen Hoffmeister, a managing director at Advent. “Over the past six years, MORSCO has completed 13 acquisitions, expanded into new regional markets and business lines and accelerated growth to become an industry leader. We believe Reece will provide a great new home for MORSCO, and we are confident that the Company will continue to thrive and expand domestically with the added support and resources of Reece.”
“Advent International has been a valued partner to our company,” said Chip Hornsby, chief executive officer of MORSCO. “With their support and strategic guidance, MORSCO has become one of the largest plumbing, HVAC and waterworks supply companies in the U.S. The Reece track record of innovation is truly world-class, and their customer offering is second to none. We very much look forward to joining forces with a successful, strategic, long‐term industry player, and we believe there will be many opportunities for cross‐pollination of ideas and talent over the years ahead.”
Reece Chief Executive Officer Peter Wilson said, “We’re excited to be entering a long‐term partnership with MORSCO to invest in the growth of their business in the U.S. market. It’s a market that’s forecast to grow at twice the rate of the Australian market, and it is currently about eight times the size. By working with this experienced local team led by Chip Hornsby, we are writing the next chapter of Reece’s growth for the benefit of our team, our customers, our suppliers and the long‐term wealth generation of our shareholders.”
The transaction is expected to be completed in July 2018.