(By Balaseshan) WESCO International Inc.(NYSE:WCC), a provider of supply chain management and logistics services, said its subsidiary WESCO Distribution Inc. has agreed to buy maintenance, repair and operating (MRO) products distributor Conney Safety Products LLC.
The acquisition is expected to add to WESCO's earnings per share by at least 10 cents in the first year of operation. Closing is expected to occur in July 2012.
WESCO's Chief Executive John Engel said the addition of Conney to the WESCO team supports the company's One WESCO growth strategy and expands its MRO supplier base, enabling it to bring additional safety products and services to its customers.
With revenues of about $85 million, the addition of Conney Safety Products is expected to significantly strengthen WESCO's safety products and service portfolio and enhance the company's e-commerce capabilities.
Conney, which is headquartered in Madison, Wisconsin, will function as a center of excellence supporting the safety needs for WESCO's customers, including its Global Accounts, Utility and Integrated Supply customers.
Conney's acquisition rate of return is above WESCO risk-adjusted average cost of capital. Conney's gross and operating margins are higher than WESCO.
WESCO is a distributor of products and provider of supply chain management and logistics services used primarily in industrial, construction, utility and commercial, institutional and Government markets.
WESCO is a provider of electrical, industrial, and communications maintenance, repair and operating (MRO) and original equipment manufacturers (OEM) products, construction materials, and advanced supply chain management and logistics services.
WCC closed Friday's regular session down 1.19% at $53.33. The stock has been trading between $31.08 and $68.19 for the past 52 weeks.