Keep on top of the latest acquisitions on MDM’s M&A news page, which lists all news articles on acquisitions that MDM reports at mdm.com. This new monthly blog will provide a digest of M&A activity from the previous month.
It’s been a busy month for M&A in wholesale distribution markets. Deals spanned sectors and ranged from larger national deals to small local deals. Global M&A activity across industries in the first quarter 2013 was positive, up 10 percent over the prior-year quarter. And reports indicate optimism for deals through the end of 2013.
At the end of March and start of April, pharmaceutical distributor and services company AmerisourceBergen announced two planned divestments. The distributor announced it would sell its Canadian distribution business to Kohl & Frisch Limited for between $80 million and $100 million.
The Canadian business only represented about 2 percent of AmerisourceBergen’s overall sales. In an article in Bloomberg Businessweek, Citi Investment Research analyst George Hill said that that the Canadian business has been a “money-losing” operation for AmerisourceBergen and that Canada has been a tough market for distributors because of its lower reimbursement rates for generic drugs. AmerisourceBergen also lacked scale in the market, he said.
AmerisourceBergen also plans to sell its contract drug packaging subsidiary, AndersonBrecon, to affiliates of an investor group that includes Greenspring Associates, QIC Global Private Equity and Thomas McNerney & Partners for $308 million. With that divestment, AmerisourceBergen says it will be able to focus on its core businesses of distribution, specialty and manufacturer services.
Other acquisitions from March 2013:
- ABC Supply has expanded in Michigan with an acquisition, adding four locations in the state. The building products distributor's co-founder also regained 100 percent ownership last month. ABC Supply's acquisition of Bradco Supply had resulted in minority shareholders in 2010; those shareholders will redeem their shares.
- Needham Electric Supply acquired Bristol County Electrical Supply. In the past four months, Needham added nine new locations through both organic and acquisitive growth.
- In another electrical distribution deal, Crescent Electric bought Iowa-based Lake Electric Supply.
- Electronics distributor Avnet acquired again, with the purchase of RTI Holdings in China and Hong Kong.
- Genuine Parts Company expanded in Australia with the $800 million purchase of the remaining 70 percent share of auto parts distributor Exego Group.
- Redistributor Bunzl plc expanded in Brazil with the acquisition of a healthcare distributor.