Scherer Brothers boosts presence in Twin Cities - acquisition of Justus Lumber Co - Brief Article

Home Channel News, Sept 17, 2001

BROOKLYN PARK, MINN. -- Scherer Brothers Lumber has acquired Justus Lumber, a single-unit pro dealer based in Hopkins, Minn. Justus Lumber, which was founded in 1893, generates annual sales of over $20 million.

Justus Lumber would be Scherer Brothers' fifth location in the Twin Cities market, joining its four lumberyards in Minneapolis, Arden Hills, Shakopee and Albertville, Minn. Justus also brings to Scherer a loyal customer base of high-end builders and remodelers, said Bill Clemen, Scherer Brothers' vp-retail operations.

"Justus is a high-service, high customer care operation," Clemen said. "They don't push volume. They push service." The majority of its professional customers are custom and upscale builders, Clemen noted. Scherer Brothers, one of the country's strongest independent pro dealers with $145 million in revenue last year, caters more toward high-volume production builders.

In serving the high-end market, Justus Lumber carries a more expensive line of building materials -- such as higher-grade dimension lumber and plywood -- than does an average Scherer yard. Clemen said that Scherer also views Justus'

high-end builder clients as a new market for its building components.

"One of the significant opportunities here for Scherer Brothers is the new sales channel for our manufactured components," he explained. Scherer operates two truss and wall-panel plants, a window and door fabrication factory as well as a custom cabinet shop.

Clemen outlined three other reasons for the acquisition: Justus Lumber operates a well-known, state-of-the-art Marvin Window showroom; it has a solid consumer-oriented installation business; and it is a family-run business with a "cultural" similarity to Scherer Brothers.

Regarding Justus' installation business, Clemen said that it does not overlap with Scherer's. Justus provides consumer-oriented installation of windows and doors, while Scherer offers wood flooring, wall panel, vinyl siding and other installation for its builder customers exclusively.

With the completion of the merger, Justus Lumber president Jim Justus, whose grandfather founded the company more than a century ago, is retiring. Justus Lumber executive vp Peter Throdahl will head up the Justus Lumber division for Scherer.

In a prepared statement, Justus and Scherer said that the deal would provide new benefits for both its customers and employees.

"Together we will work hard to be the outstanding materials, service and solutions provider to the residential construction industry," stated the two companies.