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In The News:

Global electrical distributor Rexel held its Investor Day last week, at which it gave a comprehensive overview of its plans for the next couple of years. The presentation was posted on the Rexel Web site. (Look for a detailed report of the meeting in the Dec. 25 issue of MDM Premium.)

Hear Gexpro CEO  Mitchell Williams speak at the MDM  Webcast, Ready for the Rebound?  Position Now to Take Market Share.

It seems like distributors are starting to consider acquisitions again after a long dry spell in 2008-2009, and Rexel is no exception. As part of its strategy through 2012, Rexel plans to continue growing through select acquisitions both in mature and emerging global markets.

Of course, acquisitions are not a new thing for Rexel. From 2005 to 2008, the distributor implemented 24 bolt-on acquisitions (with less than €50 million in sales); five "mid-sized" acquisitions (with €50 million to €200 million in sales); and of course, two "transforming acquisitions," as the company describes them. The distributor acquired Gexpro (formerly GE Supply) in 2006, and Hagemeyer's operations in Europe in 2008. The Gexpro deal doubled the size of Rexel's operations in the U.S., while the Hagemeyer deal increased its market share in Europe from 12 percent to 18 percent, according to Rexel estimates.
 
So where will the acquisitive distributor focus its resources going forward?
 
It plans to strengthen its market share in North America and key European markets. Rexel also has plans to expand in emerging markets. It noted China, Southeast Asia and India, as well as Mexico and Brazil.
 
Most notably, the distributor plans to double sales in China by 2012. Currently, according to the presentation, the distributor has about €200 million in sales in China.
 
Overall, emerging market sales will account for 5 percent of overall sales in 2009.


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