Building a ‘Super-Regional Leader’

The story of Lehman Pipe and Supply broadly mirrors those of many distributors operating across the nation: a family business that gradually grew into something else entirely.

But the particulars of the company’s journey have been unique from the start — and a new jolt of financing appears poised to take it even further.

‘Miami’s Oldest Family Business’

Lehman Pipe and Supply Inc.Lehman has long been one of the oldest family-owned businesses in Miami, where it was founded in 1946 and remains to this day. The company — initially a hardware supply store — took shape just as South Florida’s population began to explode.

Julian Lehman and his wife, Betty — according to the former’s 2011 obituary — began running Lehman Pipe and Supply the day after Julian left the military following his service in World War II. Funding for the startup, the story continued, came from $2,500 that Betty had saved up, along with “a few dollars” that Julian won while “shooting dice on the troopship home.”

Nearly three decades in, the Lehmans’ son, Dennis, joined the business, and in 1980, the company expanded into the wholesale distribution of pipe, valves and fittings. The business focused on local trades and municipalities until the turn of the century, when officials made the decision to expand abroad — serving markets in South America, Central America and the Caribbean.

The past decade, however, saw the most ambitious expansion efforts to date. The company moved into its current home — a 100,000-square-foot distribution hub on Miami’s far northwest side — in 2017, then bolstered its physical footprint both in South Florida and in its international markets. First came locations in Medellín, Colombia, and Santo Domingo, Dominican Republic, in early 2020, followed by a Pompano Beach, Florida, hub later in the year and, finally, the opening of its Fort Myers, Florida, location last spring.

The result, company officials said, was a business that evolved into one of the area’s “dominant” PVF distributors.

A New Generation of Leadership

Recent changes in the company’s operations were accompanied by an evolving leadership picture, as well: at the beginning of 2023, Josh Aberman was named Lehman’s president, succeeding Dennis Lehman after more than three decades at the helm of his parents’ company.

Lehman Pipe and Supply Inc.Like many other family-owned distributors in recent years, officials also began looking around for a partner that could help the new generation of company leadership continue to build the business.

In early September, Lehman announced an agreement with Rotunda Capital Partners, a suburban Chicago private equity firm focused on lower-middle market companies across the industrial, distribution and logistics sectors.

Rather than sell the business outright, however, Rotunda said that it had made an investment in Lehman in partnership with its existing management. The firm said that it had long targeted the PVF distribution sector for investment, and that Lehman possessed many of the characteristics that it had looked for: a strong management team, a reputation for customer service, and a diverse product and customer mix.

Achieving its Full Potential

The addition of a new partner, meanwhile, could allow Lehman to broaden its ambitions even further: pursuing bolt-on acquisitions, and expanding outside its native Florida.

Lehman Pipe and Supply branch, Santo Domingo.Lehman Pipe and Supply Inc.“With additional resources and support, we will be able to grow our current footprint, expand our product offering for our existing customers and execute on our strategic acquisition strategy,” Aberman, who remains the company’s chief executive officer, said in the announcement.

“Together with management, we have the opportunity to build a super-regional leader through selective acquisitions and new greenfield locations across the South and Southeast United States,” added Rotunda Managing Partner Dan Lipson. “We are all aligned on how to invest in the team and operations so that the company can enter new markets and win new business.”

Although Lehman’s leadership remains in place, the agreement with Rotunda saw John Posey join the company as its executive chairman. Posey, a Rotunda operating executive, previously led operations in the Northeast U.S. for building materials distributor US LBM, and formerly helmed the PVF division at plumbing and industrial supply giant Ferguson.

For Dennis Lehman, who remains a strategic advisor and a member of the company’s board, the deal meant enabling the company started by his parents to “achieve its full potential.”

“We never strive to be bigger,” Lehman recently told the American Supply Association’s Supply House Times. “We understand that bigger doesn’t make you better, but being better could make you bigger.”