Distribution Solutions Group (DSGR) said Monday it plans to offer $700 million of senior notes due 2032 through a newly formed subsidiary controlled by its LKCM Headwater Investments affiliate.
The company said the proceeds will initially be placed in escrow pending the completion of LKCM Headwater's previously announced agreement to acquire the remaining shares of DSG for $35 per share in cash.
Upon closing, the company said it will assume the notes and its subsidiaries will guarantee the debt.
The offering proceeds, together with an equity contribution from LKCM Headwater, are expected to fund the acquisition, repay part of its existing debt, cover transaction expenses and support general corporate purposes, including future acquisitions, the company added.