Posted January 9, 2020

Anixter calls latest WESCO merger proposal a superior offer

Anixter International's board of directors announced that the latest offer from WESCO to acquire Anixter is superior to a previously announced merger agreement with Clayton, Dubilier & Rice.

Under the terms of WESCO’s revised offer, WESCO would acquire Anixter for nominal consideration of $100.00 per share, reflecting an enterprise value of approximately $4.5 billion including net debt. The proposed consideration consists of $70.00 per share in cash, 0.2397 shares of WESCO common stock, and $15.89 per share in face amount of WESCO perpetual preferred stock.

The Anixter board has determined WESCO's proposal represents a "Superior Company Proposal" as defined in Anixter's merger agreement with CD&R.

“After careful review and consideration and consultation with our financial and legal advisers, the board of Anixter has determined that the current WESCO offer is superior to the existing CD&R agreement,” said Sam Zell, chairman of Anixter.

Anixter has notified CD&R of the Anixter board’s determination and, pursuant to the CD&R Merger Agreement, CD&R has the option for the next five business days to negotiate an amendment of that agreement.

"WESCO's proposal to acquire Anixter provides significant immediate value to Anixter's stockholders along with the opportunity for both companies' stockholders to benefit in the upside of this transformative combination. We are pleased that the Anixter board has determined that our latest proposal represents a superior company proposal and look forward to executing a merger agreement," said John J. Engel, WESCO's chairman, president and CEO.

Under the CD&R Merger Agreement, Anixter is required to pay a $100 million termination fee to CD&R if the Anixter board terminates the CD&R Merger Agreement in order to enter into an agreement with WESCO. WESCO has agreed to pay the termination fee on Anixter’s behalf in such event.

CD&R's original offer for Anixter was made Oct. 30, offering a per-share price of $81 in a deal worth $3.8 billion. WESCO submitted a competing bid of $93.50 per share in December, and later upped the offer to $97 per share when CD&R submitted a matching counteroffer.