Global Fastener News

Home Depot Considering Bids for Wholesale Division

John Wolz

Two separate private equity firms are each set to bid roughly $10 billion for HD Supply, the wholesale distribution arm of Home Depot, according to Bloomberg News Service.

HD Supply includes three fastener companies Home Depot acquired in 2005 and 2006: Crown Bolt, Brampton Fastener (Brafasco) and Western Fasteners.

Bloomberg quoted an unnamed insider reporting that Bain Capital LLC, Carlyle Group and Clayton Dubilier & Rice Inc. are the final bidders and an agreement could be reached next week.

Just months after renaming its wholesale business HD Supply, the home improvement retailer announced in February it was considering options including selling, spinning off or a public offering of the wholesale business to focus on retail business. “With annual revenues of approximately $12 billion, HD Supply is a healthy, growing and vibrant business, and we are undertaking this evaluation to determine whether there are strategic alternatives with respect to HD Supply that would optimize shareholder value,” CEO Frank Blake announced in February after Robert Nardelli was ousted as CEO. Nardelli’s strategy had been to grow the distributor business until it generated 20% of the Home Depot”s revenues. Some Home Depot investors complained that the wholesale division is a diversion from the core retail business and the $8 billion Nardelli acquiring the 38 companies that became HD Supply.

HD Supply has nearly 1,000 locations in the U.S and Canada with more than 26,000 employees. The division sells to the infrastructure, construction and maintenance supply industries. HD Supply reported $12.1 billion in 2006 revenues or 13% of Home Depot”s sales. Web: ****************************************************************

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Precision Castparts Acquires Scotland’s Caledonian Alloys

John Wolz

Precision Castparts Corp. agreed to acquire Caledonian Alloys Group Ltd., a provider of nickel superalloy and titanium revert management for the aerospace and industrial gas turbine industries.

Revert includes re-melting and reusing byproducts from fastener manufacturing, casting and forging. Revert includes metal chips, casting gating, bar ends, forging flash and other byproducts.

“At today’s metal prices, managing the revert stream from our manufacturing process – casting, forging and machining – is crucial,” CEO Mark Donegan explained. “Caledonian significantly improves our ability to capture this value stream, creating a closed-loop system for the retention and reuse of internally-generated revert.”
Livingston, Scotland-based Caledonian also has operations in Huntington, WV; Hereford, England; and Pizen, Czech Republic.

Terms of the transaction were not announced. It is expected to close during the second fiscal quarter of 2008. Caledonian will become part of PCC’s Forged Products segment.
In just over three years, PCC has built a $1.25 billion fastener business. In February PCC added Cherry Aerospace, bought for $300 million from Acument Global Technologies (the former Textron Fastening Systems), to its aerospace fastener business, which include Air Industries and critical aerospace fastener maker Shur-Lok.
Precision Castparts assembled its fastener division by acquiring SPS Technologies in 2003 for $893 million and airframe fastener manufacturer AIC in early 2005 for $194 million.

PCC supplies structural and airfoil components for the aircraft engine and industrial gas turbine industries and has diversified into non-aerospace businesses. The company has more than 80 facilities in 22 states and 16 countries. Web: precast.com �2007 FastenerNews.com