Wesco Finalizes Merger With Anixter to Consolidate Fragmented Market

The transaction was in the works since last year and getting to this point required Wesco to fight off a private equity firm that wanted to buy Anixter.

PITTSBURGH — Wesco Int’l (NYSE: WCC) completed its acquisition of Anixter Int’l on Monday, to form the largest distributor of electrical products in North America, according to an announcement.

Wesco, which distributes industrial, construction and utility equipment, pursued Glenview, Ill.-based Anixter, whose specialty is in data communications, security, wire and cable products, to consolidate a fragmented market.

“Today marks a significant milestone for Wesco and Anixter,” Wesco President and CEO John Engel states. “In combining two industry leaders with successful track records, we are creating the premier electrical, communications and utility distribution and supply chain solutions company in the world.”

The merger agreement has been in the works since last year and getting to this point required Wesco to fight off a private equity firm that wanted to buy Anixter and, it was then revealed, had also pursued Wesco.

Wesco raised its bid for Anixter multiple times until it was declared the winner. The final deal is valued at $4.5 billion. The combined company is expected to have 18,600 employees and would have had $17 billion in revenue last year.

The merged company is expected to be accretive to Wesco’s earnings in the first full year of ownership and, with the realization of synergies, substantially accretive thereafter. Wesco also expects the transaction to generate significant margin expansion and earnings per share (EPS) growth. The combined company offers strong free cash flow generation, supporting continued investments in the business and enabling a return of capital to stockholders in the future, the announcement states.

Wesco states it will utilize the strength of the combined company’s cash flows and synergies to reduce its leverage quickly and expects to be within its long-term target leverage range of 2x to 3.5x within 36 months.

If you enjoyed this article and want to receive more valuable industry content like this, click here to sign up for our FREE digital newsletters!

Security Is Our Business, Too

For professionals who recommend, buy and install all types of electronic security equipment, a free subscription to Commercial Integrator + Security Sales & Integration is like having a consultant on call. You’ll find an ideal balance of technology and business coverage, with installation tips and techniques for products and updates on how to add to your bottom line.

A FREE subscription to the top resource for security and integration industry will prove to be invaluable.

Subscribe Today!

Leave a Reply

Your email address will not be published. Required fields are marked *

Get Our Newsletters