LKCM Headwater to Buy Distribution Solutions Group in All-Cash Deal
The transaction will take the specialty distributor private through a deal offering an 81% premium to a March closing price.
LKCM Headwater Investments, LLC agreed to acquire Distribution Solutions Group, Inc. (DSGR) in an all-cash transaction.
Under the terms of the definitive merger agreement, newly formed entities controlled by LKCM Headwater will acquire all outstanding shares of the company not already owned by the investment firm and its affiliates for $35.00 a share in cash. The purchase price represents an approximately 81% premium to the company's closing share price of $19.31 on March 13, 2026, which was the last trading day before the public disclosure of LKCM Headwater's proposal.
The transaction will result in Distribution Solutions Group becoming a privately held company 100% controlled by LKCM Headwater and its affiliates. LKCM Headwater and its affiliates currently hold approximately 79% of the company's outstanding common stock. J. Bryan King, who serves as the Chairman and Chief Executive Officer of Distribution Solutions Group, is also the Managing Partner of LKCM Headwater.
Distribution Solutions Group operates as a multi-platform specialty distribution company providing value-added solutions to the industrial technologies, original equipment manufacturer, and maintenance, repair & operations markets. The company was formed through the combination of TestEquity, Gexpro Services, and Lawson Products. It serves approximately 220,000 customers globally with a workforce of about 4,300 employees.
Closing of the deal is subject to customary conditions, including stockholder approvals and the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The transaction is not subject to a financing condition, though the company entered into an amendment to its existing credit agreement with JPMorgan Chase Bank, N.A. to allow revolving loan proceeds to be used for the merger.
Upon completion of the merger, the company's common stock will no longer be listed on Nasdaq.