Jan. 30, 2008 - HD Supply/Watsco HVAC Deal Cancelled, Close 8 Former Apex Branches
“Watsco approached us about this opportunity because they saw the value and profitability of our HVAC business,” said Erica Crosling, director of public relations and community affairs at HD Supply. “We did, and still do believe, in the viability of this business and its long-term growth prospects. Our intent to do business with Watsco was always dependent upon a deal that made sense for us from a financial standpoint. Unfortunately, we could not reach an agreement that made good financial and business sense for us, as our HVAC business is still very viable and profitable. Our strategy remains to provide the best HVAC and plumbing product offerings and service in the business and to continue to be an industry leader in the HVAC and plumbing space.”
In December, Watsco Senior Vice President Barry Logan said that Watsco had signed a letter of intent to acquire the HD Supply branches that sell the Rheem line of HVAC products, primarily in the Southeast.
Also, in November, HD Supply agreed to sell its lumber and building materials division to Denver-based building materials distributor Pro-Build Holdings. The Pro-Build acquisition is expected to close in February, according to Crosling.
She confirmed that HD Supply has closed eight branches that had been part of Apex Supply Co. (Atlanta, GA) - five in Tennessee and three in Georgia, and laid off employees. This move was attributed to the decline in the residential housing market and the termination of a distribution agreement the company had with Trane.
Other closings by HD Supply have also been reported recently, including an HVAC and plumbing supply division in Mobile, AL, that had 12 employees. In late January the distributor announced plans to close a plumbing and HVAC branch in Tucson, AZ. The company still has an HVAC branch operating in Mobile, AL, and an HD Supply Waterworks location in Tucson will remain open.
“Like other companies that are closely tied to economic cycles, we are continually looking for ways to better align ourselves and reduce costs,” Crosling told Supply House Times. “Businesses across our industry that focus on residential construction have had to make similar difficult decisions. But we are always focused on first class customer service.
“We are a portfolio of 11 different businesses,” she continued. “These forced reductions have had zero effect on those other parts of our business that do not serve the residential market. We are still a strong industry leader.”
For more information, visit www.hdsupply.com.