Winnipeg Free Press - PRINT EDITION
Posted: 05/22/2013 1:00 AM | Comments: 0
Last Modified: 05/22/2013 7:17 AM | Updates
McMunn & Yates Building Supplies, the Dauphin-based independent lumber and hardware store that has provided a Manitoba-owned retail presence in small-town Manitoba since the early '70s, has agreed to acquire most of the assets of the struggling McDiarmid Lumber Ltd.
The agreement includes all of McDiarmid's store locations except the Nairn Avenue location in Winnipeg and stores in Yorkton, Sask., and Sioux Lookout, Ont.
McMunn & Yates has also agreed to buy McDiarmid's contracting and farm and commercial divisions as well as Superior Truss. Its ready-to-move home division is not part of the agreement.
The deal is said to valued at around $30 million.
McDiarmid has been struggling for the past couple of years. The business challenges prompted a messy family dispute between original owner Tom Matthews and his son-in-law Vince Ryz, who had been running the business for the past five years.
The dispute ended up in court with family members suing each other. Ryz stepped down earlier this year and Matthews injected some additional capital and installed restructuring specialist Richard Hutchings to run the business and negotiate a deal.
Hutchings said his prime marching order was the preservation of as many jobs as possible.
"I think we've done a fair job salvaging most of the jobs," Hutchings said. "We had lots of offers. McMunn & Yates was not necessarily the top price but it represented the best opportunity for our employees. It will get those locations back on track."
McDiarmid has about 400 employees.
Jason Yates, the CEO of McMunn & Yates, was unavailable for comment Tuesday afternoon. The deal is scheduled to close in early June.
McMunn & Yates, which used to be called McMunn & Yates Do-It Centres, started with one store in Dauphin. Through acquisitions and new store construction it now has 16 locations, mostly in small-town Manitoba -- from Thompson and Flin Flon in the north to Roblin and Russell in western Manitoba to Steinbach in the south. It also has stores in Yorkton and Kamsack, Sask., and a store in Charleswood it acquired in 1988.
While McMunn & Yates has been growing steadily, McDiarmid had been heading in the other direction. McDiarmid closed stores in Brandon, Portage la Prairie and Prince Albert, Sask., last year as well as a distribution centre in Elie and a ready-to-move homes distribution operation in North Battleford, Sask. Its Western Window and Door division was shut down in March.
It has scheduled an auction of surplus trucks and other equipment from its discontinued operations for early June.
Hutchings said McDiarmid will continue to operate the ready-to-move homes division that has sites in Headingley and Yorkton, Sask., and is in negotiation with individual interested parties for the stores in Yorkton, Sioux Lookout and Nairn Avenue. Matthews owns the Nairn location, which will continue as a clearance centre.
A statement of claim was filed in Manitoba court last fall by Matthews against Ryz. In dispute was who actually controlled the company -- Ryz, who orchestrated a disputed share issue last fall, or Matthews. Ryz hung on to his posts for a couple of months after being publicly lambasted by his father-in-law in a sworn affidavit. He stepped down earlier this year.
Hutchings said the contracting, farm and commercial and truss divisions have all produced double-digit growth since new management was put in place. However, McDiarmid's retail operations continued to decline this year. Hutchings said poor spring weather was at least partially to blame.
"But I think that's ready to pick up," Hutchings said.
Republished from the Winnipeg Free Press print edition May 22, 2013 B6
Updated on Wednesday, May 22, 2013 at 7:17 AM CDT: replaces photo, adds fact box
Having problems with the form?Contact Us Directly
Newfoundland loses Churchill Falls court bid
New EU sanctions to target Russian businesses
Molson Coors Brewing CEO to retire at year's end
Pot may be legal, but homeowner agreements can ban
Loonie lower amid strong durable goods data
Orders for US durable goods up 0.7 per cent in June
Toronto stock market heads lower, up for week
Cyprus passes bailout review
US agency probes Hyundai Sonata air bag problem
Settlement reached in a key Nortel dispute
Son of S.Korea sunken ferry owner detained
Russian execs fear lasting damage from plane crash
Russia raises key rate amid Ukraine concerns
Family feud sparks revolt at grocery store chain
UK economy grows to surpass pre-crisis peak
World markets drift ahead of US data next week
China pork giant WH Group makes 2nd IPO attempt
Towering worry: Small holes cause big jitters
German business confidence drops for 3rd month
BSkyB to take over Italian, German pay TV networks
Historic Civil War battle sites have a mobile app
Potato growers cutting back
CORE of Apple's future success
Twitter workforce sees male majority
Rain, flooding losses: $1.1B
Travel tips for a safe and stress-free vacation
Oil price slips below $102 a barrel
Fast food workers prepare to escalate wage demands
Japan inflation eases in June under tax hike blow