Pittsburgh-based electrical products distributor WESCO International won the bidding war for Anixter International on Monday with a roughly $4.5 billion cash and stock deal that will absorb the Glenview-based company into WESCO's portfolio.
Anixter's board of directors announced they have accepted WESCO's latest offer, which would give Anixter shareholders a cash and stock combination worth approximately $100 a share. The offer topped one made by bidding rival Clayton, Dubilier & Rice LLC, a New York-based private equity firm, for $97 per share.
"The agreement with WESCO is a great result for our stockholders who will receive significant near-term value and stand to benefit from the combined company's growth and prospects," said Anixter board Chairman Sam Zell, who owns about 9% of the company's stock.
Under the deal, Anixter would become part of publicly-traded WESCO, and its stock will be delisted. The combined company will have revenues of approximately $17 billion and will be a leading electrical and data communications distributor in North America, according to company officials.
WESCO officials noted the acquisition will allow it to focus on increasing digitization strategies and provide a platform for growth in emerging markets.
"With increased scale and complementary capabilities, we will be ideally positioned to digitize our business, expand our extensive services portfolio and supply chain offerings, and deliver solutions to our customers whenever and wherever they need them around the globe," said WESCO President and CEO John J. Engel. "Given the enhanced strategic profile and competitiveness of the combined company, we are confident we will deliver improved growth and earnings, and exceptional cash flow generation."
The deal is expected to close in the second or third quarter of 2020. officials said.
The bidding war for Anixter began last October when CD&R made a bid for Anixter, offering a per-share price of $81 in an all-cash deal worth $3.8 billion. That seemed a done deal until WESCO stepped in mid-December with a counter offer of $4.3 billion in a cash/stock deal. Anixter's board agreed to go with the CD&R offer on Jan. 2, but WESCO returned with the $4.5 billion shortly after.
Last week, Anixter board called WESCO's offer "superior" but said it would give CD&R the opportunity to make a new offer.
Anixter will be required to pay a $100 million termination fee to CD&R under the original deal, but WESCO officials said they would pay that fee on Anixter's behalf.