Latest from Industry

Illustration_60886103 / Kheng To To / Dreamstime
Iillustration_60886103 / Kheng Ho To / Dreamstime
Illustration 60886103 / Kheng Ho To / Dreamstime
Photo provided by Southwire
Electricalmarketing 459 United Copper Industries Denton Texas595 0

Southwire Bolsters Building Wire Offering with Purchase of United Copper Industries

Sept. 23, 2016
Southwire said the acquisition expands its manufacturing capabilities in the core building wire products segment and enhances Southwire’s geographical footprint.

Southwire made news again in the wire and cable industry with its purchase this week of United Copper Industries, Denton, Texas, the third largest manufacturer of building wire in the United States, from KPS Capital Partners, New York. United Copper also produces metal-clad cables.

KPS is a private-equity firm that manages the KPS Special Situations Funds, a family of private equity funds with over $2.7 billion of assets under management focused on investing in restructurings, turnarounds and other special situations. United Copper’s sales figures were not released and annual revenue estimates on and D&B’s Million Dollar Database were pretty far apart, with the D&B estimate coming in at $228.9 million and Hoovers estimating annual sales at $500 million.

According to a Southwire press release, United Copper Industries has a workforce of approximately 300 employees and a 450,000-sq-ft-facility in Denton that includes sales and support resources, a copper rod mill, a manufacturing plant and distribution resources. Southwire plans to fully integrate this campus into its existing operations so that the campus will serve as a strategically-located facility with opportunities for long-term operations, expansion and increased capacity.

Southwire said the acquisition expands its manufacturing capabilities in the core building wire products segment and enhances Southwire’s geographical footprint, increasing the ability to respond to customer growth in key markets.

“At Southwire, we remain committed to growth within our core markets. This acquisition provides us with an opportunity to expand one of our largest product offerings for both electrical wholesalers and retail customers,” Norman Adkins, president of Southwire’s Construction Systems and Solutions Group, said in the press release. “As we focus on the ever-developing needs of our customers, the addition of United Copper will help to expand our operational footprint to grow with them.”

KPS built United Copper from a 2011 acquisition of the U.S.  wire and cable assets of Organizacion IUSA, S.A. de C.V.  A KPS press release said that under its ownership, UCI transitioned to an independent company by “retaining a new management team and creating a new organizational structure; investing a substantial amount of capital to modernize UCI’s equipment, materially improving its operating cash cost structure, labor productivity and plant efficiency; and implementing a new strategic, service-oriented approach to customers and the market that led to volume increases well in excess of overall market growth.”

David Shapiro, a managing partner of KPS (not the well-known electrical industry executive David Shapiro) said in a company release, “We are very proud of UCI’s transformation under our ownership.  In 2011, we acquired an undermanaged and underutilized satellite U.S. production facility that operated as a highly transactional market participant. We transformed the company into a consistently profitable, rapidly growing North American building wire and cable manufacturer that is a true partner to its national and regional customer base of electrical distributors. KPS worked with management to improve every aspect of UCI, resulting in industry-leading service, quality and manufacturing efficiency. We take immense pride in what UCI has accomplished. The success of our investment in UCI demonstrates KPS’ ability to see value where others do not, to buy right and to make businesses better.”

Hykin said in the press release, “Working in partnership with KPS, the UCI team implemented a turnaround plan that materially improved the productivity and efficiency of our plant while improving quality and service.  These changes formed the foundation for UCI’s significant growth over the past three years. We are grateful to KPS for providing our team with the leadership, expertise, capital and other resources that were essential to our success. The UCI team looks forward to a seamless transition to Southwire ownership for our customers and employees.”

Southwire, a privately held company with annual sales that top $5 billion, according to Forbes magazine, has made quite a few blockbuster acquisitions since Roy Richards, Sr., started the company in 1950 with 12 employees. The company’s acquisitions include Alflex, American Insulated Wire (AIW), Coleman Cable, Essex Electrical Products, Maxis, Seatek and Tappan Wire and Cable and General Cable’s building wire assets.

Southwire and United Copper both use independent  reps to go to market, although Southwire uses a blend of reps and factory-employed regional salespeople. From information available on the companies’ web-sites,  there appears to be little overlap in representation, although Walker-Loudermilk, Kansas City, Mo., is listed as a rep by both companies.