WESCO: Bid for IDG Was a `Full and Fair Valuation'

In WESCO's recent conference call on its first-quarter earnings, CFO Stephen Van Oss addressed the distributor's ultimately withdrawn bid for Industrial Distribution Group in April:


(IDG) strategically fit our business well and they have done a good job on those types of programs with smaller customers, where WESCO's programs tend to be with much larger engagements. … Additionally, they had a number of specialty businesses, some of which lined up nicely with WESCO's strength, such as the manufactured housing area, where we could leverage our infrastructure nicely and bring in some new products sets to get better penetration."

Van Oss said that WESCO felt it had a "full and fair valuation"with its $11.75 bid ($0.05 less than Platinum Equity's bid) and the distributor did not want to "chase the price up."Luther King Capital Management ultimately won the bidding war with an offer of $12.10 a share.

"We had already moved through the due diligence process to a level we thought was full and fair,"Van Oss said.

Van Oss also commented on WESCO's plans in the acquisition arena:

"I think we have a good program and I hope that the IDG scenario proves we are a disciplined acquirer. And we are not going to force something in just to get top-line growth or to meet some type of perceived outside target."