The Plain Dealer reports Western Reserve Partners’ role in Lesco sale of its manufacturing and distribution business

January 8, 2005

The Plain Dealer reported “Lesco Inc. looks to shed distribution” on page C1 in its Saturday, January 8, 2005 Business Section. The article opens by explaining that “Lesco Inc. thinks its stock will be more attractive to investors if the company gets out of the manufacturing and distribution business.  So it has hired Western Reserve Partners LLC to advise the turf-care company on ways to spin off those operations.”   

The article goes on to explain that the company “The sales portion of Lesco includes 274 service centers around the country that dispense turf-care products, as well as 72 so-called Stores-on-Wheels that visit places such as golf courses or colleges where turf superintendents are employed.  (Chief Financial Officer Jeff) Rutherford said this part of the business, if separated from the rest of the company, could have a return-on-capital ratio in the “high teens, low twenties.”

Rutherford goes on to say that “Lesco is looking for someone to buy the manufacturing and distribution operations and then agree to supply Lesco with the products it needs.  The buyer could be a company already in the business or perhaps venture capitalists. Some other arrangement where Lesco keeps an equity interest also could result.  Lesco hopes to complete a deal with the first half of 2005.”

The article closes with “A number of retail companies are looking at a similar strategy by focusing on their core strengths, said David Dunstan, a managing director at Western Reserve Partners, an investment bank in Cleveland.

The complete text of the January 8, 2005 article in The Plain Dealer can be found here.