Atlanta—On May 13, Floor & Décor, a multichannel specialty retailer operating 140 warehouse-format stores across 32 states, entered into a definitive agreement to acquire 100% of Spartan Surfaces, a leading end-to-end commercial flooring specifying distribution company, for consideration of up to $90 million. Spartan Surfaces, headquartered in Bel Air, Md., will operate as a subsidiary of Floor & Decor Holdings, Inc., and will continue to be led by the Spartan Surfaces senior management team.
A portion of the consideration will be paid through 2024 based on the achievement of predefined fiscal performance goals. The acquisition will be financed with cash-on-hand and $5 million of Floor & Decor common stock. It is expected to be accretive but not material to Floor & Decor’s diluted earnings per share for fiscal 2021, excluding transaction and integration costs. The transaction is expected to close in the second quarter of fiscal 2021.
“We have seen strong growth in our commercial business over the last several years by providing a simplified, reliable and lower cost solution for commercial projects that leverages our merchandise sourcing and supply chain infrastructure,” said Tom Taylor, Floor & Décor CEO. “The addressable commercial market is large at an estimated $13 billion, and we believe Spartan Surfaces is the right strategic partner to enable us to incrementally accelerate our commercial flooring growth plans through their scalable specifying and consultative selling business model that primarily serves the architectural and design community.”
Kevin Jablon, founder and CEO of Spartan Surfaces, added: “Floor & Decor’s extensive sourcing and distribution capabilities of innovative, trend-forward products will serve as a key selling point for our business development team and for projects that depend on reliability and near-term supply. As we look to the future, we are excited that Floor & Decor has the experience and resources to help us accelerate our growth plans into many untapped and highly fragmented markets across the United States, while maintaining our unique culture.”
(Look for more on this story in the May 24/31 edition of FCNews.)