APPLETON, Wis., May 18 /PRNewswire/ -- School Specialty, Inc. (Nasdaq: SCHS), announced today the acquisition of two companies located in California that will significantly increase the Company's sales/student penetration levels in the largest K-12 student population state. The acquisitions could add more than $24 million to School Specialty's annual revenues. Terms of the acquisition, which was half cash and half stock, were not disclosed. "School Specialty is extremely excited about these acquisitions for several reasons," stated Daniel Spalding, chairman and chief executive officer. "First, these are the first two 'traditional' school supply companies we have acquired since School Specialty acquired its No.1 competitor, Beckley Cardy, in August of 1998. "Moreover," Spalding continued, "the combined sales force of these two companies -- 19 experienced sales representatives -- brings a wealth of knowledge and experience specifically focused on serving customers in the State of California." According to Spalding, combined with current School Specialty revenues, these acquisitions make School Specialty the dominant force in educational supply sales in California increasing sales penetration from approximately $6 to more than $10 per student within this state. The acquired companies are: -- Audio/Graphics, located in Ontario, California, was founded in 1961 and sells school furnishings and audio/visual equipment to the K-12 schools in southern California. Founder, Ted DeGroot, Chairman and CEO, will continue to manage Audio/Graphics through the transition. -- Holsinger, Inc. located in Menlo Park, California, has been selling school furnishings in northern California since 1948. President, Chris Lirely, and his management team will continue to manage Holsinger. According to management, the respective valuations of the two acquisitions give a multiple of 4.9 historical EBITDA as well as approximately 27 as a percentage of revenues. "Another large benefit to these acquisitions," added Spalding," is that, combined with our recent expansion in California, we will be able to consider further consolidation of facilities to better serve our customers throughout the western United States." School Specialty, Inc., "The Nation's Education Resource," is the largest supplier of non-textbook education products to educators in the United States. School Specialty offers over 60,000 different products to more than 108,000 schools throughout the United States. The company produces nine different catalogs, and mails over 10 million catalogs to customers each year, servicing these customers with approximately 2,200 employees. School Specialty has a diversified approach to the market, with its School Specialty and Beckley- Cardy brands focused on serving administrators and procurement specialists with a national sales force, and its eight specialty direct brands -- ClassroomDirect.com, Childcraft, Sax Arts & Crafts, Hammond & Stephens, Gresswell, Frey Scientific, Brodhead Garrett and Sportime -- serving teachers and curriculum specialists. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. For more information about School Specialty, Inc. toll-free via fax, dial 1-800-PRO-INFO or 1-800-776-4636, follow the voice menu prompts and enter the company code "SCHS" or 7247 on any touch tone phone.
SOURCE School Specialty, Inc.