Interline Brands Announces Acquisition – GS Capital Partners and P2 Capital Partners For $1.1 Billion

Interline Brands, Inc. (NYSE:IBI), a leading distributor and direct marketer of broad-line maintenance, repair and operations (“MRO”) products, has announced that it has entered into a definitive agreement to be acquired by affiliates of GS Capital Partners LP (“GS Capital Partners”) and P2 Capital Partners, LLC (“P2 Capital Partners”) for $25.50 per share in cash. GS Capital Partners is one of the world’s leading private equity investors. P2 Capital Partners, a shareholder of Interline, is a leading investment firm that applies a private equity approach to investing in the public market. The transaction, which was unanimously approved by Interline’s board of directors, is valued at approximately $1.1 billion, including the assumption of debt. The price of $25.50 per share represents a premium of approximately 42% relative to the Company’s closing stock price on May 25, 2012, the last trading day before the announcement of the transaction, and a 31% premium relative to the Company’s trailing 30-day average closing stock price. “This agreement provides excellent value to shareholders. This is also an exciting new chapter for Interline, one that we believe will bring broad benefits to all of our stakeholders,” said Michael J. Grebe, Interline’s Chairman and Chief Executive Officer. “We remain laser-focused on our goals and capabilities, and look forward to working with partners that have proven track records of investments in the distribution sector, as well as financial and operational expertise in global markets. Moreover, Interline has operated successfully in both public and private settings in the past. As we now look forward, GS Capital Partners and P2 Capital Partners have a shared vision of our value creation opportunities and the actions needed to realize them.” Interline intends to maintain its corporate headquarters in Jacksonville, Florida, as well as its distribution and sales footprint. In addition to equity from funds managed by GS Capital Partners and P2 Capital Partners, it is anticipated that certain members of Company management will invest a portion of their proceeds from the transaction. GS Capital Partners and P2 Capital Partners have also secured committed debt financing from Goldman Sachs and Bank of America. Barclays is serving as financial advisor to Interline and has provided a fairness opinion in connection with the transaction. Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as legal advisor to the Company in connection with the transaction.  Goldman Sachs is acting as financial advisor to GS Capital Partners, and Fried, Frank, Harris, Shriver & Jacobson LLP is acting as legal advisor. Debevoise & Plimpton LLP is acting as legal advisor to P2 Capital Partners. The transaction is subject to certain closing conditions, including the approval of Interline’s shareholders and regulatory approvals, but is not subject to any condition with regard to the financing of the transaction. The agreement permits Interline to solicit alternative proposals from third parties through June 28, 2012. The Interline board of directors, with the assistance of its advisors, will actively solicit acquisition proposals during this period. If there is not a superior offer, the transaction is expected to close by the end of the third quarter of 2012. Interline will be submitting a current report on Form 8-K with the U.S. Securities and Exchange Commission containing a summary of terms and conditions of the proposed acquisition. About Interline – Interline Brands, Inc. is a leading distributor and direct marketer with headquarters in Jacksonville, Florida. Interline provides broad-line MRO products to a diversified customer base of facilities maintenance professionals, professional contractors, and specialty distributors primarily throughout North America, Central America and the Caribbean. About GS Capital Partners LP – Since 1986, the Goldman Sachs Merchant Banking Division and its predecessor business areas have raised 16 private equity and principal debt investment funds aggregating over $82 billion of capital (including leverage). GS Capital Partners VI is the current private equity vehicle through which Goldman Sachs conducts its large, privately negotiated, corporate equity investment activities. A global leader in private corporate equity investing, GS Capital Partners is a family of funds with a focus on large, high quality companies with strong management and funding acquisition or expansion across a range of industries and geographies. Founded in 1869, Goldman Sachs is a leading global investment banking, securities and investment management firm that provides a wide range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals. About P2 Capital Partners, LLC – P2 Capital Partners, LLC is a New York-based investment firm that applies a private equity approach to investing in the public market. P2 manages a concentrated portfolio of significant ownership stakes in high quality public companies in which it is an active shareholder focused on creating long-term value in partnership with management. The firm will also lead private equity transactions within its public portfolio. P2’s limited partners include leading public pension funds, corporate pension funds, endowments, foundations, insurance companies, and high net worth investors.


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