Distribution Solutions Group (NASDAQ:DSGR) shares surged 25% after the industrial distribution company agreed to be acquired by affiliates of LKCM Headwater Investments in an all-cash transaction valued at $35.00 per share.
Trading in the stock was temporarily halted ahead of the announcement before resuming with sharp gains following confirmation of the deal.
LKCM Headwater to take full ownership
Under the definitive merger agreement, newly created entities controlled by LKCM Headwater Investments will acquire all outstanding Distribution Solutions shares not already owned by the investment firm or its affiliates.
LKCM Headwater currently controls approximately 79% of the company’s outstanding common stock. Once the transaction closes, Distribution Solutions will become a privately held business wholly owned by LKCM Headwater and its affiliates, and its shares will be delisted from the Nasdaq.
Offer reflects a substantial premium
The agreed purchase price of $35.00 per share is $5.50 higher than LKCM Headwater’s initial non-binding proposal of $29.50 per share, which was submitted to the board on 14 March 2026.
The final offer represents an approximate 81% premium to Distribution Solutions’ closing share price of $19.31 on 13 March 2026, the final trading session before the initial proposal became public.
Board committee unanimously backs transaction
To oversee the process, Distribution Solutions established a special committee made up of independent directors to evaluate and negotiate the proposal.
The committee unanimously approved the merger agreement and recommended that the board support the transaction.
Completion of the acquisition remains subject to customary closing conditions, including the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, required shareholder approvals, and the absence of legal or regulatory barriers.
The company noted that the deal does not include a financing condition.
Distribution Solutions stock price
