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Distribution Solutions Group to Acquire GradeEight for $145 Million

BullishMedium impact
DSGR$35.05 −0.06%

Distribution Solutions Group, Inc. (DSGR) has agreed to acquire GradeEight for approximately $145 million. Under the deal terms, DSG subsidiary Lawson will merge GradeEight into a wholly owned subsidiary. DSG plans to fund the purchase using available cash balances alongside borrowings from its $400 million revolving credit facility, with no financing conditions attached.

GradeEight operates a multi-brand maintenance, repair, and operations platform that includes Winzer and FastServ. The company generates about $110 million in annual sales and serves approximately 12,000 customers through 270 franchisees and eight retail locations. DSG expects the transaction to boost its adjusted EBITDA margins.

The transaction is slated to close in the fourth quarter of 2026, pending customary closing conditions. Separately, Distribution Solutions Group remains subject to a pending parent-led merger that would take the company private, subject to shareholder approval.

Key points

  • Distribution Solutions Group, Inc. (DSGR) is acquiring GradeEight for approximately $145 million.
  • GradeEight generates about $110 million in annual sales across 12,000 customers and 270 franchisees.
  • The deal will be funded via cash and DSG's $400 million revolving credit line, closing in Q4 2026.
  • The transaction is expected to be accretive to DSG's adjusted EBITDA margins.
  • DSG also faces a separate pending parent-led transaction to take the company private.

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Questions and answers

How much is Distribution Solutions Group paying for GradeEight?

Distribution Solutions Group agreed to acquire GradeEight for approximately $145 million, funded through cash on hand and borrowings under its $400 million revolving credit line.

What does GradeEight bring to Distribution Solutions Group?

GradeEight adds a multi-brand platform generating about $110 million in annual revenue, serving roughly 12,000 customers via 270 franchisees and eight retail locations.

When will the GradeEight deal close?

The acquisition is expected to close in the fourth quarter of 2026, subject to customary closing conditions.