Ferguson buys FloWorks from Wynnchurch in $1.6bn transaction
The deal values the Houston flow-control distributor at 10 times adjusted EBITDA when expected synergies are included, according to PE Hub.
By Amanda Ross · Deals Correspondent
· 2 min read
Ferguson is buying FloWorks from Wynnchurch in a transaction valued at $1.6bn, according to PE Hub. The reported consideration equates to 10 times last-12-month adjusted EBITDA after including expected synergies of about $45mn, PE Hub said.
FloWorks is based in Houston and supplies specialised flow-control products, according to PE Hub. The company also provides technical solutions for maintenance, repair and operations applications, a segment commonly referred to as MRO.
The sale marks an exit for Wynnchurch from an industrial distribution business that PE Hub said had been expanded through acquisitions. Since 2023, Wynnchurch completed seven add-on deals for FloWorks, taking the company to about $1bn in revenue and widening its geographic reach, according to PE Hub.
How the build-up worked
Add-on acquisitions are a standard private equity tool in which a platform company buys related businesses to increase scale, broaden its local presence or add product and service capabilities. PE Hub attributed FloWorks’ growth under Wynnchurch to seven such transactions since 2023, alongside expansion of the company’s footprint.
For a specialty distributor, scale can affect the breadth of products available to customers and the density of service coverage across regions. PE Hub did not provide details on the individual acquisitions, their purchase prices or the specific geographies added.
Valuation and synergies
The reported valuation multiple compares the $1.6bn consideration with adjusted EBITDA for the last 12 months, while reflecting expected synergies of approximately $45mn. EBITDA, or earnings before interest, tax, depreciation and amortisation, is commonly used in acquisition analysis as a proxy for operating earnings before financing and certain accounting charges.
Adjusted EBITDA can exclude items that a buyer or seller views as not representative of continuing operations. In this deal, PE Hub reported that the 10 times multiple includes expected synergies, which are anticipated benefits from combining businesses or operations. Such estimates are part of the valuation framework reported for the transaction and are distinct from benefits already realised.
PE Hub did not disclose further terms of the transaction in the available report, including financing details, closing conditions or management arrangements for FloWorks after the sale. The report also did not name advisers to Wynnchurch, Ferguson or FloWorks.
This story draws on original reporting from PE Hub.
