The 2020 Mid-Year Economic Update_long

M&A Activity Picks Up Steam

Distributors, manufacturers return to expansion mode.
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As I noted in a blog in December, 2011 became an active year for mergers and acquisitions. But by some accounts, there was still a lot of room to build on that trend. Respondents to the fourth-quarter Baird/MDM Distribution Survey reported more inquiries than they’ve seen in the past. One respondent in the industrial gases sector wrote: \”The public companies are all over everybody there; we have anybody and everybody calling us.\”

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And it appears sales prices are starting to come into alignment for the acquirers, as well. \”People I never thought would sell are selling at extremely favorable prices,\” wrote another respondent.

(Read more on the survey results.)

While the survey respondents listed above were both in industrial segments, news from the past week shows that the gates have opened across the sectors. Here are just a few of the deals we’ve reported on:

Rexel announced three acquisitions in the past week: two in Brazil and one in Canada.

DXP Enterprises expanded its presence in safety products with the acquisition of Mid-Continent Safety.

Applied Industrial also grew in Canada with the acquisitions of two distributors in Quebec.

Switzerland-based ABB announced it would acquire Thomas & Betts.

See more M&A news on mdm.com.

With the increase in M&A activity, consolidation once again has become a key concern for many distributors, and if the pace continues to grow, the market may indeed have a very different look in a couple years.

Are you seeing an increase in M&A activity in your sector? Share your thoughts below!

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