Anixter board calls WESCO offer 'superior,' but stays with CD&R offer

  • Anixter International's board of directors Thursday called the latest offer from Pittsburgh-based WESCO International -- a deal that pushes the proposed sale to about $4.5 billion -- a "superior offer." But the board also said it will continue to support a $4.3 billion cash offer from New York equity firm Clayton, Dubilier & Rice, LLC.

    Anixter International's board of directors Thursday called the latest offer from Pittsburgh-based WESCO International -- a deal that pushes the proposed sale to about $4.5 billion -- a "superior offer." But the board also said it will continue to support a $4.3 billion cash offer from New York equity firm Clayton, Dubilier & Rice, LLC. Courtesy Anixter International

  • Sam Zell

    Sam Zell

 
 
Updated 1/10/2020 2:42 PM

The bidding war for Glenview-based industrial electronics company Anixter International took a new turn Thursday as Anixter's board of directors called the latest offer from Pittsburgh-based WESCO International -- a deal that pushes the proposed sale to about $4.5 billion -- a "superior offer."

But the company also said the board continues to support the $4.3 billion offer by New York-based equity firm Clayton, Dubilier & Rice, LLC. made last month.

                                                                                                                                                                                                                       
 

WESCO's latest offer would acquire Anixter in a cash and stock deal that totals $100 per share. That is up from the $97 per share offer the electronics distribution and services company submitted earlier this week.

"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," Anixter board chairman Sam Zell, who holds about 9% of the company's stock, said Thursday.

CD&R, which is offering to buy the company for $93.50 per share in an all-cash deal, has the option to negotiate a new agreement in the next five days, said Kevin Burns, Anixter's senior vice president -- investor relations and treasurer. If CD&R decides not to modify its offer, Anixter's board could then decide to go with the WESCO bid.

"There can be no assurances that a transaction with WESCO will result from WESCO's offer, or that any other transaction will be consummated," according to Anixter's statement.

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Anixter's shareholders are scheduled to vote on the current CD&R proposal Feb. 4 in Chicago, Burns said, but if the board goes with the WESCO offer, a new proxy would be drawn up and the shareholder meeting would be rescheduled.

If the WESCO offer is accepted, Anixter would also be required to pay a $100 million termination fee to CD&R. WESCO would pay that fee on Anixter's behalf, Burns said.

Anixter would become part of publicly traded WESCO if the bid is accepted, Burns added. Under the CD&R offer, Anixter would become a privately held company.

CD&R originally made a bid for Anixter on Oct. 30, offering a per-share price of $81 in a deal at the time worth $3.8 billion. That seemed a done deal until WESCO stepped in 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.

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