Distributor increases U.S. presence with acquisition

By Staff -- Purchasing, 10/19/2000

With a letter of intent to acquire 100% ownership of Cameron & Barkley, Dutch distributor Hagemeyer is looking to increase its presence in the U.S.

In November 1999, Hagemeyer acquired U.S.-based Tristate Electrical & Electronic Supply Co. and Vallen Corp.

Headquartered in Naarden, The Netherlands, Hagemeyer is a global distribution company with 1999 revenues of ERU 6.4 billion, and 17,000 employees operating in more than 60 countries around the world.

Cameron & Barkley, Charleston, S.C., is an MRO distributor and provider of on-site storeroom management services, with annual revenues of about $850 million. The company operates in 24 U.S. states, predominantly in the Southeast, but also in the northern Midwest and Northwest, Canada and Mexico. Founded in 1865, Cameron & Barkley has been 100% employee-owned since 1983. It has 2,080 full-time employee-owners.

Integrated supply is one of Cameron & Barkley's fastest growing businesses.

The proposed acquisition, which is subject to approval by Cameron & Barkley's employee owners, is expected to advance Hagemeyer's strategic repositioning as a global provider of value-added distribution services to industrial customers.

Following extensive discussions between Hagemeyer and the management of Cameron & Barkley regarding the strategic benefits of joining forces, Cameron & Barkley's board of directors has unanimously voted to sign a letter of intent regarding the proposed acquisition. The transaction, which also must receive the necessary regulatory clearances, is expected to close in the fourth quarter.

"In industry terms, this is a unique and powerful international combination that will significantly enhance Hagemeyer's prospects for becoming a world leader in value-added distribution services," says Rob ter Haar, chairman and CEO of Hagemeyer. "First, we will support Cameron & Barkley in accelerating market share and economies of scale gains in consolidating the U.S. MRO supplies market. Second, the combination will enable us to provide customers in Europe and the U.S. with a significantly expanded range of products and services at a reduced cost over a broader geographic platform. In addition, Cameron & Barkley's best practice in integrated supply will enhance our drive to develop European-scale one-stop shopping supported by an integrated B2B infrastructure."

Cameron & Barkley will form part of Hagemeyer's PPS North America, a subsidiary of the Group's Professional Products and Services division, whose other units include Tristate and Vallen.

Tristate is an electrical distributor headquartered in Hagerstown, Md., with sales of $200 million and more than 5,000 employees. It operates 34 branches in Maryland, Delaware, Virginia, West Virginia and Pennsylvania. Tristate works closely with a number of affiliated distributors through Supplyforce.com, which combines the many benefits of e-commerce with the fulfillment support of the traditional distribution network.

Vallen, headquartered in Houston, Texas, has sales of $450 million and nearly 1,300 employees. Vallen manufactures and distributes safety products at 171 locations throughout the U.S., Mexico and Canada. Vallen is growing its value-added service component through its Total Safety Solutions programs.