Moline, Ill.-based Deere & Co. last week announced that it entered into a definitive merger agreement to acquire Lesco Inc. for $14.50 per common share in cash.
Headquartered in Cleveland, Ohio, Lesco is a supplier of consumable products, such as fertilizer, seed and chemicals, for lawn maintenance professionals and golf course superintendents. Upon closing, the company will become part of John Deere Landscapes, a wholesale distributor of irrigation, nursery, lighting and landscape materials in the United States.
“This plan is consistent with Deere’s growth aspirations,” said Nate Jones, president, Commercial & Consumer Division. “We seek business opportunities that bring new customers to John Deere and that offer new products and services to our existing customers.”
The transaction will roughly double the number of store locations for John Deere Landscapes with the addition of Lesco’s 332 stores, strengthening its presence across the U.S. and especially in the eastern seaboard states.
The combination of Lesco and John Deere Landscapes will significantly increase the volume of consumable products sold by John Deere Landscapes; will expand the customer base for both Lesco and John Deere Landscapes products and services; and will complement John Deere’s work in the Golf & Turf One Source business, which focuses on bringing total solutions to those who maintain golf course properties.
The transaction is subject to customary closing conditions, including approval of Lesco’s shareholders and regulatory approval, and is expected to close during the second calendar quarter of 2007. Lesco’s board of directors has unanimously approved the merger agreement and recommends that Lesco’s shareholders adopt the merger agreement.
Merrill Lynch & Co. acted as financial advisors, and Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisors to Deere & Company in connection with this transaction. William Blair & Company and Western Reserve Partners LLC served L Lesco as financial advisors.
Lesco provides products for the professional green and pest control industries. It serves customers worldwide, through 332 Lesco Service Center locations, 114 Lesco Stores-on-Wheels vehicles, and other direct sales efforts.