Boca Raton, FL, May 9--Q.E.P. Co. Inc. announced that it has entered into an asset purchase agreement with Halex Corporation of Pomona, California, to acquire the Capitol USA adhesives division, located in Dalton, Georgia.
Lewis Gould, Chairman and Chief Executive Officer of Q.E.P. commented, "The acquisition of the Capitol USA adhesives division will add an enormous amount of synergy to Q.E.P.
"Capitol USA is a prime manufacturer of adhesives for the flooring industry with annual sales of approximately $10 million, and is a premier brand name in the flooring industry. Capitol USA's adhesives manufacturing facility will be fully integrated into Q.E.P.'s supply chain and augment Q.E.P.'s current capacity to manufacture critically needed adhesives for Q.E.P.'s expanding business."
Gould further stated that "Capitol USA's 104,000 square foot warehouse in Dalton will provide a strategic location to support Q.E.P.'s continued growth. Q.E.P. will now have under its corporate umbrella the Q.E.P., Roberts, and Capitol brands for its customers. With the acquisition of the Capitol USA adhesives division, Q.E.P. is now one of the largest leading manufacturers of adhesives for the flooring industry."
In exchange for the Capitol USA adhesives division, Q.E.P. paid cash, entered into a four year promissory note and transferred all of the assets of its Roberts carpet seaming tape manufacturing business to Halex, including a license to use the Roberts trademark in Halex's distribution carpet seaming tape business. Q.E.P. will continue to sell carpet seaming tape to its Home Center Customers. The cash portion of the purchase was financed through the utilization of Q.E.P's existing credit facility.
