The drama of consolidation among Europe’s largest electrical distributors continues to unfold. Rexel, Paris, made a $4.3 billion hostile bid for Netherlands-based Hagemeyer in the last week of October. The bid came a few weeks after Sonepar made an unsolicited offer to buy Hagemeyer for $3.5 billion.
Rexel’s offer is a 47 percent premium over Hagemeyer’s average share price for the one-month period prior to Oct. 9, Rexel said. Even though the offer is significantly higher than the $3.5 billion bid tendered by Sonepar, Hagemeyer rejected both bids as too low. Hagemeyer said in a press released issued Oct. 30 it was prepared to have a further meeting if requested by Rexel.
Rexel said it would pay $6.64 in cash for each share of Hagemeyer. Sonepar had offered $6.14 a share for Hagemeyer on Oct. 9.
Rexel said if the acquisition was successful, it would sell Hagemeyer’s American, Asian-Pacific and certain European businesses to Sonepar, averting a bidding war with its French rival.
Rexel would retain most of Hagemeyer’s Professional Products & Services activities in the Baltic countries, Belgium, the Czech Republic, Finland, Germany, Ireland, the Netherlands, Norway, Poland, Russia, Slovakia, Spain and the United Kingdom. The resulting increase to Rexel’s sales, on a 2006 pro forma basis, is estimated at about $5.2 billion.
Rexel has $13.4 billion in international sales, and more than 25,000 employees working in 1,900 branches in 29 countries.
Sonepar has more than $12.4 billion in international sales, and more than 22,000 employees working in 1,330 branches in 29 countries.
Hagemeyer, which posted sales of about $8.7 billion in 2006, is a dominant player in the United Kingdom and certain other areas of Europe. It became known in the United States through its 1999 acquisition of Tristate Electrical and Electronics Supply Co., Hagerstown, Md., and 2000 acquisition of Cameron and Barkley Co., Charleston, S.C. It also has a large position in safety products distribution through its 1999 acquisition of Vallen Corp., Houston.