Rugs USA exceeds M&A synergy targets by 60%

Facing their largest acquisition yet, Rugs USA turned to West Monroe to accelerate value creation, aiming to consolidate operations while driving profitability. Building on existing synergy insights, our team drilled down on data from both Rugs USA and Annie Selke, uncovering new opportunities across supply chain and technology functions. This analysis formed the basis of a detailed integration roadmap. With clear synergy targets and functional teams in place, we unlocked a path that delivered a 60% increase in EBITDA synergies from diligence estimates, ensuring this strategic acquisition would reach its full potential.

In just seven months, West Monroe and Rugs USA executed a fast-paced integration, leveraging Intellio® Deliver to guide nine targeted workstreams. We mobilized an Integration Management Office (IMO), setting up operational and cost-saving structures. Our team established a new organizational structure, consolidating distribution centers to reduce freight expenses by 70% and applying a revamped sourcing strategy that achieved 114% savings. This shift improved customer experience through faster delivery times while lowering costs, aligning with Rugs USA’s vision for long-term operational efficiency and future growth.

Our focus on value creation paid off, with Rugs USA seeing a 60% increase in EBITDA synergies over initial estimates. The integration improvements also resulted in a 10x return on investment, largely driven by operational and sourcing efficiencies. Completing the project two months ahead of schedule and 30% under budget further solidified the success of the merger. Beyond immediate financial gains, the project set a foundation for long-term growth and a scalable blueprint for future acquisitions.