UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 17, 2012
WESCO International, Inc.
(Exact name of registrant as specified in its charter)
Commission file number 001-14989
Delaware | 25-1723342 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |
225 West Station Square Drive | ||
Suite 700 | ||
Pittsburgh, Pennsylvania 15219 | (412) 454-2200 | |
(Address of principal executive offices) | (Registrant's telephone number, including area code) | |
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 7.01. Regulation FD Disclosure
As part of its previously scheduled conference call on October 18, 2012 at 11:00 a.m., WESCO International, Inc. (the “Company”) will hold an investor conference call in connection with the agreement announced on October 17, 2012 to acquire EECOL Electric Corporation and affiliated companies. A slide presentation (the “Slide Presentation”) has been prepared for use in coordination with the investor call. Pursuant to General Instruction F to Current Report on Form 8-K, the Slide Presentation is attached to this Current Report as Exhibits 99.2 and incorporated by this 7.01 by reference. The information contained in this Item 7.01, including the information set forth in the Slide Presentation as filed as Exhibit 99.2 to, and incorporated in, this Current Report, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section. The information in Exhibit 99.2 is furnished pursuant to this Item 7.01 shall not be incorporated by reference into any registration statement or other documents pursuant to the Securities Act or into an filing or other document pursuant to the Exchange Act except as otherwise expressly stated in any such filing.
Item 8.01 - Other Events
On October 17, 2012, the Company announced that through a wholly owned subsidiary, WDCC Enterprises Inc., it has entered into a Share Purchase Agreement to acquire EECOL Electric Corporation and affiliated companies. A copy of the press release issued by the Company on October 17, 2012 is filed as Exhibit 99.1 to this Current Report and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits
(d) | Exhibits. |
Exhibit 99.1 | Press Release issued on October 17, 2012 |
Exhibit 99.2 | Slide Presentation |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
October 17, 2012 | WESCO INTERNATIONAL, INC. | |||
(Date) | ||||
/s/ Kenneth S. Parks | ||||
Kenneth S. Parks | ||||
Vice President and Chief Financial Officer | ||||
 | NEWS RELEASE |
WESCO International, Inc. / Suite 700, 225 West Station Square Drive / Pittsburgh, PA 15219 | |
WESCO International, Inc. Announces the Acquisition of
Canadian-headquartered EECOL Electric Corporation
Pittsburgh, October 17, 2012: WESCO International, Inc. (NYSE: WCC), a leading provider of electrical, industrial, and communications MRO and OEM products, construction materials, and advanced supply chain management and logistics services, announced today that, through a wholly owned subsidiary, it has entered into a definitive agreement to acquire EECOL Electric Corporation, headquartered in Calgary, Alberta, Canada, and various affiliated companies for a purchase price of approximately CAD $1.14 billion.
Consummation of the transaction is subject to certain conditions, including approval under the Canadian Competition Act. The acquisition is expected to be financed utilizing a new institutional term loan to be entered into on or before closing, as well as WESCO's existing credit facilities. Closing is expected to occur in the fourth quarter 2012.
Founded in 1919, EECOL Electric is one of Canada's premier full-line distributors of electrical equipment, products, and services with approximately $0.9 billion in annual sales, 57 locations across Canada and 20 in South America, and more than 20,000 customers. EECOL has a strong warehouse-based business focused on serving industrial, oil, gas, mining, utility, and commercial and residential construction customers.
Mr. John J. Engel, WESCO's Chairman, President and Chief Executive Officer, stated, “EECOL is a strong company with a long and successful track record of delivering above-market sales growth and profitability. We have a high regard for EECOL's sales culture and excellent customer service capabilities, as well as their supplier partnerships, which complement WESCO very well. The addition of EECOL expands WESCO's presence in Canada and broadens our international footprint, specifically our capabilities in South America. This acquisition is expected to be accretive to earnings by approximately $1.00 per diluted share in the first full-year of operation.”
Mr. Tom Crist, EECOL Electric's President and Chief Executive Officer, commented, “We are very pleased to have reached this agreement with WESCO. We have known the WESCO management team and organization for years and are confident it will be a great home for our business and our team. Through this acquisition, we can leverage our strong supplier partnerships, customer relationships, and brand equity and are looking forward to teaming with our new colleagues. EECOL has a rich heritage dating back to 1919, and as we look to the future opportunities as part of WESCO, we have never been better positioned for growth.”
Mr. Stephen A. Van Oss, WESCO's Senior Vice President and Chief Operating Officer, commented, “We have had great respect for EECOL for many years and are pleased to have EECOL become part of WESCO. Together we will expand our sales and service capabilities and capitalize on the strong supplier relationships of each company for MRO, OEM, and capital project-related opportunities. The addition of EECOL enhances our ability to grow and capitalize on the ongoing investments we have made in Canada.”
- more -
Page 2 -- WESCO International
Conference Call To Be Held Thursday, October 18, at 11 a.m. ET
WESCO will address this transaction Thursday, October 18, at 11 a.m. Eastern Time during the company's third quarter 2012 earnings call. Log-in information may be accessed by clicking on the microphone icon on WESCO's home page at www.wesco.com. An audio replay of the conference call will be available on the WESCO website through midnight, Wednesday, October 24, 2012.
Dial in for the call is as follows:
Conference telephone number:
Participant Dial In: 800-860-2442
International Dial In: +1 412-858-4600
Confirmation Code: Ask for the "WESCO" conference call
Replay: 877-344-7529
International Replay: +1 412-317-0088
Replay available from 1:00 p.m. ET October 18 thru midnight ET October 24, 2012.
Confirmation Code: 10019113
###
About WESCO
WESCO International, Inc. (NYSE: WCC), a publicly traded Fortune 500 holding company headquartered in Pittsburgh, Pennsylvania, is a leading provider of electrical, industrial, and communications maintenance, repair and operating ("MRO") and original equipment manufacturers ("OEM") product, construction materials, and advanced supply chain management and logistic services. 2011 annual sales were approximately $6.1 billion. The Company employs approximately 7,500 people, maintains relationships with over 18,000 suppliers, and serves over 65,000 active customers worldwide. Customers include commercial and industrial businesses, contractors, government agencies, institutions, telecommunications providers and utilities. WESCO operates eight fully automated distribution centers and approximately 400 full-service branches in North America and international markets, providing a local presence for customers and a global network to serve multi-location businesses and multi-national corporations.
The matters discussed herein may contain forward-looking statements, including statements regarding whether and when the acquisition is expected to be consummated, that are subject to certain risks and uncertainties that could cause actual results to differ materially from expectations, including risks related to the acquisition, financing, and integration of EECOL, results of the review of the proposed transaction by regulatory authorities, satisfaction of various other conditions to closing contemplated by the agreement, debt levels, changes in general economic conditions, fluctuations in interest rates, increases in raw materials and labor costs, levels of competition and other factors described in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2011, as well as the Company's other reports filed with the Securities and Exchange Commission.
Contact: Daniel A. Brailer, Vice President, Investor Relations & Corporate Affairs
WESCO International, Inc. (412) 454-2200, Fax: (412) 222-7566
http://www.wesco.com
DRIVING GROWTH > CREATING VALUE October 17, 2012 WESCO Announces EECOL Electric Acquisition
DRIVING GROWTH > CREATING VALUE Oct 2012 2 WESCO – EECOL Acquisition Conference Call Safe Harbor Statement Note: All statements made herein that are not historical facts should be considered as “forward- looking statements” within the meaning of the Private Securities Litigation Act of 1995. Such statements, including statements regarding whether and when the acquisition is expected to be consummated, involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. Such risks, uncertainties and other factors include, but are not limited to, risks related to the acquisition, financing and integration of EECOL, results of the review of the proposed transaction by regulatory authorities, satisfaction of various conditions to closing contemplated by the acquisition agreement, debt level, changes in general economic conditions, fluctuations in interest rates, increases in raw materials and labor costs, levels of competition and other factors described in detail in Form 10-K for WESCO International, Inc. for the year ended December 31, 2011 and any subsequent filings with the Securities & Exchange Commission. Any numerical or other representations in this presentation do not represent guidance by management and should not be construed as such. The following presentation may also include a discussion of certain non-GAAP financial measures. Information required by Regulation G with respect to such non-GAAP financial measures can be obtained via WESCO’s website, www.wesco.com.
DRIVING GROWTH > CREATING VALUE Oct 2012 3 WESCO – EECOL Acquisition Conference Call • EECOL is a premier full-line distributor of electrical equipment, products, and services • Headquartered in Calgary, Alberta, Canada, with approximately 57 locations across Canada and 20 in South America, and more than 20,000 customers • Approximately $0.9B in annual sales with low double-digit EBITDA margins • Acquisition multiple approximately 10X EBITDA • Expected to be approximately $1.00 accretive per diluted share in the first year of operation • Closing is expected to occur in the fourth quarter 2012 WESCO Announces EECOL Electric Acquisition Reference: October 17, 2012 WESCO Press Release
DRIVING GROWTH > CREATING VALUE Oct 2012 4 WESCO – EECOL Acquisition Conference Call Canadian Market • Driven by natural resource sectors. • Long-term growth prospects for oil, gas, and mining are very attractive. • Construction is one of Canada’s largest industries and is growing. • Utility is experiencing increased investment. • Green and sustainability initiatives are creating opportunities for new products and services. …provides attractive long-term growth prospects
DRIVING GROWTH > CREATING VALUE Oct 2012 5 WESCO – EECOL Acquisition Conference Call WESCO Canada • WESCO Canada is headquartered in Toronto. • WESCO has been operating in Canada since 1922. • $0.9B annual sales in 2011, with a first half 2012 annualized sales run rate of approximately $1B • Approximately 1,100 employees • Extensive footprint of more than 50 WESCO branches across Canada • Broad product and service portfolio • TVC acquisition in December 2010 strengthened communications products portfolio • Brews Supply acquisition in October 2011 strengthened utility and industrial OEM • Trydor Industries acquisition in July 2012 added products and services for utility …strong business in an attractive market WESCO Canada Business Profile WESCO Canada has shown strong organic sales growth over the last several years
DRIVING GROWTH > CREATING VALUE Oct 2012 6 WESCO – EECOL Acquisition Conference Call EECOL Electric • EECOL Electric is headquartered in Calgary, Alberta, Canada • Approximately 1,420 employees • Approximately 57 branches in Canada and 20 in South America • EECOL has been operating in Canada since 1919 • Approximately $0.9B in annual sales − Roughly 90% in Canada − Remaining 10% in South America (Chile, Peru, Argentina, and Ecuador) • More than 20,000 customers − Commercial and Residential Construction − Industrial − Oil & Gas − Mining − Utility • Long-standing supplier relationships …strong business in an attractive market EECOL Electric Business Profile − Acuity Brands − Cooper − Emerson − General Cable − Hubbell − Leviton − Nexans − Osram Sylvania − Schneider Electric − Southwire − Thomas & Betts − 3M
DRIVING GROWTH > CREATING VALUE Oct 2012 7 WESCO – EECOL Acquisition Conference Call WESCO and EECOL Combination Geography Product WESCO EECOL Combined ~$6.6B Sales ~$0.9B Sales ~ $7.5B Sales …enhances WESCO diversification 35% 18% 15% 13% 10% 9% 81% 15% 4% 0% 90% 10% 54% 13% 3% 8% 3% 19% 38% 17% 13% 12% 9% 10% 77% 19% 4% General Supplies Wire, Cable & Conduit Data & Broadband Communications Distribution Equipment Controls & Motors Lighting & Controls U.S. Canada ROW PRODUCT LEGEND GEOGRAPHY LEGEND
DRIVING GROWTH > CREATING VALUE Oct 2012 8 WESCO – EECOL Acquisition Conference Call WESCO Acquisition Scorecard Acquisition Priorities Acquisition Summary Consistent with WESCO strategy Strengthens WESCO’s electrical products and services portfolio in Canada and South America. EECOL is a premier full- line distributor of electrical equipment, products, and services. Rate of return greater than WESCO risk-adjusted average cost of capital EECOL acquisition rate of return is above WESCO risk-adjusted average cost of capital. Accretive in first year of operation This acquisition is expected to be accretive by approximately $1.00 per diluted share in the first year of operation. Margins higher than WESCO EECOL’s gross and operating margins are higher than WESCO. EECOL Electric …achieves all acquisition priorities
DRIVING GROWTH > CREATING VALUE Oct 2012 9 WESCO – EECOL Acquisition Conference Call WESCO Cumulative Acquisitions Since 2010 325 400 580 0 100 200 300 400 500 600 700 2010 2011 2012 Acquisition Date Annual Sales Estimated 1st Year Accretion Potelcom 6/10 $25M TVC Communications 12/10 $300M $0.30 RECO 3/11 $25M Brews 10/11 $50M $0.04 RS Electronics 1/12 $60M $0.04 Trydor Industries 7/12 $35M $0.05 Conney 7/12 $85M $0.10 Completed $580M $0.53+ EECOL (Announced) ~$0.9B ~$1.00 …driving strategic growth and shareholder value Acquisition Priorities Consistent with WESCO strategy Rate of return greater than WESCO risk-adjusted average cost of capital Accretive in first year of operation Margins higher than WESCO Acquired Sales ($ Millions) 2 2 3 # Completed ~$0.9B EECOL 1 Announced ~$1.5B
DRIVING GROWTH > CREATING VALUE Oct 2012 10 WESCO – EECOL Acquisition Conference Call