Published in Manufacturing
UFP affiliate acquires 50% equity stake in key lumber supplier COURTESY PHOTO

UFP affiliate acquires 50% equity stake in key lumber supplier

BY Tuesday, June 28, 2022 02:58pm

An affiliate of Grand Rapids Township wood products manufacturer UFP Industries Inc. has acquired a 50-percent equity stake in a key supplier based in South Carolina.

UFP affiliate PalletOne Inc. acquired the equity stake in Orangeburg, S.C.-based Dempsey Wood Products LLC, the companies announced on Monday. The purchase agreement also includes options for PalletOne to acquire the remaining 50 percent after three years.

Founded in 1988, Dempsey produces kiln-dried lumber, pallet lumber and other industrial wood products from a single location in South Carolina, and recorded $68.9 million in sales in 2021. Dempsey’s industrial lumber is key for pallet operations and has been in short supply as larger mills produce less of the product, according to company officials.

The deal helps PalletOne secure and grow a long-term supply source. Dempsey Wood Products also has strong relationships with UFP Industries (Nasdaq: UFPI) affiliates: Last year, five of Dempsey’s 10 largest customers were UFP affiliates.

“Dempsey is led by an experienced team that has produced strong and stable results for more than four decades,” PalletOne President Howe Wallace said in a statement. “They’ve been a trusted supplier of ours for many years, and this investment will strengthen our ties, improve our work efficiencies and help satisfy our increasing need for lumber in this market.”

Dempsey’s leadership team will continue in management roles, including President Parker Dempsey, who said the deal will lead to “exciting new growth opportunities.”

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