Glenview-Based Anixter Accepts $4.5 Billion Buyout Offer

GLENVIEW, IL — A bidding war to buy the Glenview-based wiring and security products company Anixter International appeared to have come to a close with the announcement of a merger agreement with Pittsburgh-based Wesco International.

Both companies boards of directors have unanimously approved the $4.5 billion cash-and-stock deal, according to a joint statement Monday.

"This is the result of a very thorough process to determine the value of our company," Anixter President and Chief Executive Officer Bill Galvin said. "Looking ahead, the combination with WESCO will allow the combined company to build on our complementary capabilities and create new ways to serve customers and partners."

The merged company will be a leading electrical and data communications distributor in North America with expected 2019 revenues of about $17 billion, according to the joint statement.

Following the announcement, the company Wesco outbid — private equity firm Clayton, Dubilier & Rice — announced it has withdrawn its offer to take Anixter private for about $3.8 billion. That offer was which was first announced in October 2019.

Anixter has 950 employees in Glenview working in two buildings, according to the Chicago Tribune. Should the deal go through, Wesco, the future owners of the combined business, anticipate cutting costs of by $200 million by the third year of the merger. Anixter's chief financial officer told the Tribune the two companies have yet to begin planning for the consolidation.

"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," John Engel, Wesco's president, chairman and chief executive officer, said. "We look forward to welcoming Anixter's talented associates to the WESCO team as we embark on this next chapter and create substantial value for our stockholders, customers, suppliers, and people."

Anixter was founded in 1957 as Anixter Brothers by Alan and Bill Anixter with a $10,000 loan from their mother, Zelda, according to a company history. The brothers soon expanded in the wire and cable business by offering distributors and wholesalers an alternative to buying cable in bulk from manufacturers.

The company went public in 1967, and in 1986, the brothers sold it to Sam Zell's Chicago-based company Itel Corp., which changed its name to Anixter International. Zell, chair of the Anixter board, and associated entities now own about 11 percent of the company's stock.

"Today’s announcement is the culmination of a comprehensive process that showed, from the start, what a strong business the team at Anixter has built," Zell said, announcing the deal Monday. "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."

Owners of Wesco stock would own 84 percent of the combined entity, while Anixter's shareholders would hold the remaining 16 percent, it said. The buyout still requires approval from stockholders of Anixter, which is traded on the New York Stock Exchange.