Phoenix construction firm Shasta Pools & Spas has agreed to sell its retail outlets to Leslie’s Poolmart Inc.
The transaction is expected to close in February. In addition, the two firms have referred to their relationship as a loose alliance, with the companies planning to collaborate in other ways that have yet to be defined.
The sale of the six stores means an exit from retailing for Shasta, one of the nation’s largest pool builders and No. 5 on the Pool & Spa News Top 50 Builders list.
In fact, the company’s dominance in construction is a part of why Shasta is leaving retailing.
“In every area of our company, we’re either No. 1 or a very close No. 2,” explained Steve Ast, vice president of sales and marketing at Shasta. “In retail, unless there was a tremendous amount of resources put into that effort, we just didn’t see the viability of branching out and expanding that [part of the] business.”
Leslie’s plans to keep all six Shasta branches open and retain the existing staff. “We are really excited to have their employees on board, and they’ll fit well with us,” said Larry Hayward, CEO of Leslie’s, also based in Phoenix.
Rick Mortensen, Shasta’s director of retail and customer care operations, will remain on board with the construction firm.
Though the sale is expected to finalize next month, the stores’ branding will be folded into the Leslie’s network gradually, Hayward said.
“They do a lot of things really well, and we want to take the time to understand what they’re doing. And we’ll pick some things up from them, too,” Hayward said. He added that Shasta had built the pools of many of its retail customers, which created longtime, loyal relationships in the retail stores.
For Leslie’s, the move is part of an ongoing aggressive strategy that combines acquisitions with organic growth.
“We’ll build and put online over 60 new stores this year,” Hayward said. “And we will continue to look for strategic acquisitions that make sense. We’re growing pretty much straight across the board. We’re putting new stores in Florida, Texas, the Northeast, California and throughout the Sunbelt.”
The Shasta transaction marks the retailer’s third acquisition in 16 months. In August 2011, Leslie’s bought Jasper’s Clear Pool Wholesale Supply Co., a Phoenix-based supplier and service firm geared to the commercial market. In September 2010, it acquired Solutions by Self Chem, an Austin-area retailer.
The growth of Leslie’s has been fueled by funds from London-based private equity firm CVC Capital Partners, which purchased an undisclosed number of minority shares in 2010. The firm currently has 750 stores in 35 states. It sees a revenue of approximately $522 million per year and employs 3,300, according to CVC Capital Partners.
