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The biggest deals in October M&A activity across distribution verticals arguably were separate merger announcements by competitive marketing groups in the electrical sector, IMARK and Affiliated Distributors (AD). To kick off the month, IDC-USA, one of the oldest cooperatives in the bearings/power transmission sector, with 76 members, joined forces with the AD bearings/PT division, which formed a few years ago and had 31 members prior to the IDC merger.
I wrote this analysis of the merger, looking at the history and changing roles of these buying and marketing groups in leveling the playing fields of competition for independent distributors through the scale and services they provide. The value proposition of cooperatives – providing scale to independent distributors – changes over time and is challenged to meet what can be increasingly diverse objectives for its members based on their respective size, markets and product portfolios. Cooperatives have played critically important roles to help sustain a diversity of market competition and choice for customers and access to markets for suppliers. I find it interesting that the strategy for viability and growth for these two major groups has been to start consolidating verticals under one organization.
The second merger announcement was by IMARK, the largest marketing group in the U.S. electrical distribution sector, which expands the group into complementary distribution verticals. Omni Corporate Services, a member-owned group of plumbing and HVAC wholesalers across the U.S., and Equity Plumbing, formerly privately held and the largest U.S. plumbing group by membership, will be combining with IMARK to form the new group's plumbing vertical, IMARK Plumbing.
Here’s a recap of all the deals in October as reported by MDM.