American Industry Partners has agreed to buy the Fasteners’ unit of Anixter International Inc for $380 million in cash. The transaction is expected to be completed during the second quarter of this year. Goldman Sachs was the financial advisor on this deal.
GLENVIEW, Ill.–(BUSINESS WIRE)–Anixter International Inc. (NYSE: AXE) today announced that it has entered into a definitive agreement to sell its OEM Supply – Fasteners (“Fasteners”) segment to American Industrial Partners (“AIP”) for $380 million in cash, subject to certain post-closing adjustments. The transaction, which was approved by Anixter’s Board of Directors, is expected to close during the second quarter of 2015, subject to customary closing conditions and regulatory approval.
Fasteners is a leading global distributor and manufacturer of highly-engineered fasteners for customers in the heavy truck, power train, luxury automotive, agriculture, construction, recreational vehicles and other verticals. Fasteners serves customers in 15 countries, and the average relationship among its 10 largest customers exceeds 17 years. The business reported 2014 revenues of $938.5 million and operating profit of $39.1 million.
“This transaction follows significant progress by the Fasteners team in delivering improved operating performance and benefits to all stakeholders,” said Bob Eck, President and Chief Executive Officer of Anixter. “Following the transaction, Anixter will have a sharper strategic focus on our core Enterprise Cabling & Security Solutions (ECS) and Electrical and Electronic Wire & Cable (W&C) segments and additional financial flexibility to build on these strong global platforms through organic investments, as well as strategic acquisitions, allowing us to continue to deliver long-term value to shareholders. For Fasteners, this transaction will provide access to additional operational expertise and financial resources to drive continued growth in its industry.”
“We have great respect for Fasteners, which is widely recognized as a leading global OEM supplier,” said Eric Baroyan, Partner at AIP. “With deep, long-standing customer relationships, strong management, a highly customized product portfolio and significant global growth opportunities, Fasteners is well-positioned to accelerate its business performance. We are fully supportive of their strategic plan, and look forward to collaborating with their talented team to build long-term value for customers, suppliers and employees.”
“I am confident that we have found the right partner in AIP, who brings deep operating and industry expertise as well as additional financial resources, which will enhance our ability to meet the needs of our customers and capitalize on global growth opportunities,” said Ian Clarke, Executive Vice President – Fasteners at Anixter. “Today’s announcement reflects the value the Fasteners team has created, as well as AIP’s confidence in our strategy and exciting future. We look forward to working with AIP as we continue to build on our strong foundation and create long-term value for all of our stakeholders.”
The Fasteners business includes 73 distribution centers, 12 quality labs and more than 1,900 employees worldwide. Upon closing, Fasteners will continue to be led by its current management team, with Ian Clarke assuming the role of President and Chief Executive Officer of the new company. The company’s headquarters will remain in Glenview, Illinois, and the name of the new company will be announced upon closing.
AIP has also offered to acquire the portion of the Fasteners business in France that has historically supported Fasteners’ global business.
Goldman, Sachs & Co. served as financial advisor and Sidley Austin LLP served as legal counsel to Anixter. Baker Botts LLP served as legal counsel to AIP.
Anixter International Inc. is a leading global distributor of enterprise cabling and security solutions, electrical and electronic wire and cable, and OEM supply fasteners and other small parts. The company adds value to the distribution process by providing its customers access to 1) innovative inventory management programs 2) over 0.5 million products and $1.1 billion in inventory 3) approximately 270 warehouses/branch locations with 7.5 million square feet of space and 4) locations in 300 cities in more than 50 countries. Founded in 1957 and headquartered near Chicago, Anixter trades on the New York Stock Exchange under the symbol AXE.
American Industrial Partners (“AIP”) is an operationally oriented middle-market private equity firm that makes control investments in North American-based industrial businesses serving domestic and global markets. AIP has deep roots in the industrial economy and has been active in private equity investing since 1989. To date, AIP has completed over 50 transactions and is currently managing more than $1.1 billion in equity capital. AIP invests in all forms of corporate divestitures, management buyouts, recapitalizations, and going-private transactions of established businesses with revenues of $100 million to $750 million.