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Get filing alertsWatsco to acquire Jackson Supply's HVAC distribution business for $198M in all-stock deal
Filed April 29, 2026 · Period ending April 23, 2026 · ~1 min read
Key Changes
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Watsco agreed to buy Jackson Supply's HVAC distribution business for $198 million, paid entirely in stock rather than cash. Based on recent trading prices, this would result in issuing approximately 459,000 new shares, diluting existing shareholders.
Item 1.01: Asset Purchase Agreement view on EDGAR → -
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The purchase price is fixed at $198 million (net of debt and expenses), but the number of shares issued will depend on Watsco's stock price during the 10 trading days before closing, creating uncertainty about final dilution.
Item 1.01: Purchase Consideration view on EDGAR → -
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$25 million worth of the issued shares will be held in escrow for up to 12 months after closing to cover potential purchase price adjustments and seller indemnification obligations.
Item 1.01: Escrow Terms view on EDGAR → -
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The transaction is subject to customary closing conditions including regulatory approvals. The shares being issued are unregistered and will have transfer restrictions.
Item 1.01: Closing Conditions view on EDGAR →
Summary
Watsco announced it will acquire Jackson Supply's HVAC distribution business in an all-stock transaction valued at $198 million. The deal expands Watsco's distribution footprint but will dilute existing shareholders by approximately 459,000 shares based on current trading prices.
Unlike cash acquisitions, the all-stock structure means shareholders are effectively funding the purchase through dilution rather than the company deploying balance sheet resources. Retail investors should note that the final share count won't be determined until closing, as it depends on Watsco's 10-day average stock price immediately beforehand.
If the stock price falls between now and closing, more shares will be issued to reach the $198 million value, increasing dilution. The $25 million escrow provides some protection against overpayment if issues emerge post-closing. Watch for the closing announcement to see the actual dilution impact and any details about Jackson Supply's revenue and profitability that would help assess whether this acquisition creates value despite the share dilution.
Section-by-Section Diff
Event · Item 3.02 — Unregistered Sales of Equity Securities
Item 3.02 — Unregistered Sales of Equity Securities filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
On April 23, 2026, Watsco, Inc., a Florida corporation (the “Company”), entered into an asset purchase agreement (the “Purchase Agreement”) together with Jackson Supply Company, a Texas corporation (“Seller”), Jackson Supply LLC, a Delaware limited liability company and wholly owned subsidiary of the Company (“Buyer”), and the other parties thereto, pursuant to which Buyer has agreed to purchase the assets, and assume certain of the liabilities, comprising the HVAC distribution business of Jackson (the “Business”).
Watsco entered into an agreement to acquire the HVAC distribution business of Jackson Supply Company through its subsidiary Jackson Supply LLC. The transaction involves purchasing assets and assuming certain liabilities of the business. Closing is subject to customary conditions including regulatory approval.
Added in current filing · verify on EDGAR →
Pursuant to the Purchase Agreement, upon consummation of the contemplated transaction (the “Closing”), the Company has agreed to issue to Seller a number of shares of the Company’s Common stock, par value $0.50 per share (“Common Stock”), equal to $198.0 million, net of the Business’ debt and transaction expenses, divided by the daily volume-weighted average price of the Common Stock on the New York Stock Exchange for the ten most recent trading days immediately preceding the Closing (the “Consideration Shares”).
Watsco will pay for the acquisition entirely in stock, issuing shares worth $198 million (net of debt and expenses). The number of shares will be determined by the 10-day volume-weighted average price immediately before closing. This is an all-stock transaction with no cash component disclosed.
Added in current filing · verify on EDGAR →
Based on the daily volume-weighted average price of the Common Stock on the New York Stock Exchange for the ten most recent trading days ended April 27, 2026, and assuming no adjustments for debt or transaction expenses, the Company would issue an aggregate of 458,985 Consideration Shares to Seller at Closing.
Based on recent trading prices as of April 27, 2026, Watsco estimates it will issue approximately 459,000 shares to complete the acquisition. This represents the dilutive impact on existing shareholders, though the final number will depend on the stock price at closing and adjustments for debt and expenses.
Show 1 minor / wording change
Added in current filing · verify on EDGAR →
The Consideration Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and the Company offered the Consideration Shares in reliance upon the exemption from registration contained in Section 4(a) (2) of the Securities Act. Seller represented to the Company that it is an “accredited investor” as defined in Rule 501(a) under the Securities Act and that it is acquiring the Consideration Shares for investment and not with a view to distribution thereof in violation of the Securities Act.
The shares being issued are unregistered securities issued under a private placement exemption. The seller is an accredited investor acquiring the shares for investment purposes, not immediate resale. This means the shares will have transfer restrictions and cannot be freely traded immediately.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jun 4, 2026 · How we verify