A new co-op is born in the lumber arena
Lumber and building material buying cooperatives PAL and ENAP announced they have signed a non-binding Letter of Intent to merge. The companies enjoy strong dealer support in the Midwest and East markets, respectively.
“This transaction is extremely positive for members and employees alike,” said Steve Sallah, ENAP president and CEO. “The new cooperative will have a combined purchasing power of $1.5 billion dollars annually and will improve our ability to execute our mission of creating a competitive advantage for our member-dealers.”
PAL was formed in 1937, and ENAP in 1967. Moving forward, the combined membership will span 33 states and include 447 member companies operating 742 lumberyards.
PAL’s CEO and president Paul Dean was also bullish on the partnership. “This merger is a great fit for both organizations and will provide instant access to new products and programs,” he said. “ENAP and PAL have a strong history of serving our markets, and our combined size will provide even more opportunities for our members, employees and vendor partners.”
The Letter of Intent is non-binding, and the merger requires approval by the shareholders of both cooperatives as well as satisfactory completion of due diligence.
A new cooperative will be created that encourages independent affiliations for its members and earns the loyalty of its members by creating a competitive advantage for them. “Through partnerships and enhanced programs, we want our members to make their own purchasing decisions and offer choices, not restrictions, as part of our cooperative platform,” noted Dean.
Sallah will be president and CEO of the new company; Dean will be executive VP. The balance of the leadership team will include VPs and managers from both organizations. A first-quarter 2015 close on the merger is expected as both parties enter the due diligence process.
Collectively, ENAP and PAL will operate out of three locations in New Windsor, New York; Grand Rapids, Michigan; and Monroe, Louisiana. The new company will further utilize these locations to provide a national footprint with regional expertise as it continues its geographic expansion.