02 Jan Anixter International Inc. Announces Amended & Restated Merger Agreement with Clayton, Dubilier & Rice to Increase Consideration to $93.50 per Share
Total enterprise value of approximately $4.3 billion including net debt
Amended Merger Agreement unanimously approved by Board of Directors
GLENVIEW, Ill.–(BUSINESS WIRE)–Anixter International Inc. (NYSE:AXE), a leading global distributor of Network & Security Solutions, Electrical & Electronic Solutions and Utility Power Solutions, has agreed to a further amendment and restatement of the Amended Merger Agreement (the “Second Amended Merger Agreement”) with Clayton, Dubilier & Rice LLC (“CD&R”) to increase the per-share consideration payable to Anixter’s shareholders to $93.50 per share in cash (from $86.00 per share in cash and a $2.50 contingent value right upon the occurrence of certain events). The transaction is now valued at approximately $4.3 billion.
The revised per-share consideration represents a premium of approximately 31% over Anixter’s closing price on October 29, 2019, and a premium of approximately 47% over the 90-day volume-weighted average price of Anixter’s common stock for the period ended October 29, 2019.
The Second Amended Merger Agreement, amends and restates in its entirety the Amended Merger Agreement, which was announced on December 23 and valued at approximately $4 billion. The Second Amended Merger Agreement does not include the contingent value right. The voting agreement pursuant to which certain stockholders of Anixter, including entities associated with Sam Zell, have agreed, among other things, to vote their shares of Anixter common stock in favor of the merger, remains in effect with respect to the Second Amended Merger Agreement.
Sam Zell, Chairman of the Anixter Board of Directors, commented: “In evaluating the new proposal from CD&R, the Board carefully considered the value and risk profile of WESCO’s offer comprising cash, WESCO common stock and a new series of WESCO preferred stock, for which there is no established market or trading price. The Board has unanimously concluded that CD&R’s improved all-cash proposal is superior to WESCO’s offer.”
The transaction is subject to the approval of Anixter’s stockholders and other customary closing conditions. The required antitrust waiting periods have expired, or approvals or clearances have otherwise been obtained, in the United States, Canada, Mexico, Costa Rica and Turkey. The transaction remains conditioned on approvals or clearances in the European Union and Russia, which are expected to be received by February. Although the closing could occur as early as February, under the Second Amended Merger Agreement, CD&R has the right to delay the closing until a date no later than September 30th.
Under the terms of the Second Amended Merger Agreement, Anixter may, subject to the provisions of the Second Amended Merger Agreement, respond to an unsolicited proposal that is reasonably likely to result in a superior proposal. In addition, Anixter may continue to engage in discussions with WESCO International, Inc., which remains an Excluded Party (as defined in the Second Amended Merger Agreement). Anixter does not intend to disclose developments with respect to any such unsolicited proposal unless and until it determines it is appropriate to do so.
Centerview Partners LLC is serving as lead financial advisor, Wells Fargo Securities, LLC is also serving as financial advisor and Sidley Austin LLP is serving as legal advisor to Anixter in connection with the transaction. Neal, Gerber & Eisenberg LLP is serving as legal advisor to the stockholders party to the voting agreement. BofA Securities, J.P. Morgan Securities LLC, Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC and Credit Suisse are serving as financial advisors to CD&R, and Debevoise & Plimpton LLP is serving as legal advisor to CD&R.
Anixter International is a leading global distributor of Network & Security Solutions, Electrical & Electronic Solutions and Utility Power Solutions. We help build, connect, protect, and power valuable assets and critical infrastructures. From enterprise networks to industrial MRO supply to video surveillance applications to electric power distribution, we offer full-line solutions, and intelligence, that create reliable, resilient systems that sustain businesses and communities. Through our unmatched global distribution network along with our supply chain and technical expertise, we help lower the cost, risk and complexity of our customers’ supply chains.
Anixter adds value to the distribution process by providing approximately 130,000 customers access to 1) innovative supply chain solutions, 2) nearly 600,000 products and over $1.0 billion in inventory, 3) 316 warehouses/branch locations with over 9.0 million square feet of space and 4) locations in over 300 cities in approximately 50 countries. Founded in 1957 and headquartered near Chicago, Anixter trades on the New York Stock Exchange under the symbol AXE.
Additional information about Anixter is available at www.anixter.com.
About Clayton, Dubilier & Rice, LLC
Founded in 1978, Clayton, Dubilier & Rice is a private investment firm. Since inception, CD&R has managed the investment of $28 billion in 86 companies, including numerous electrical and industrial distributors. The firm has offices in New York and London.
For more information, visit www.cdr-inc.com.
Additional Information Regarding the Merger and Where to Find It
This communication does not constitute an offer to sell or the solicitation of an offer to buy the securities of Anixter International Inc. (the “Company”) or the solicitation of any vote or approval. This communication relates to the proposed merger involving the Company, CD&R Arrow Parent, LLC (“Parent”) and CD&R Arrow Merger Sub, Inc., whereby the Company will become a wholly-owned subsidiary of Parent (the “proposed merger”). The proposed merger will be submitted to the stockholders of the Company for their consideration at a special meeting of the stockholders. In connection therewith, the Company has filed with the Securities and Exchange Commission (“SEC”) a preliminary proxy statement and intends to file additional relevant materials with the SEC, including a definitive proxy statement on Schedule 14A (the “definitive proxy statement”), which will be mailed or otherwise disseminated to the Company’s stockholders when it becomes available. The Company may also file other relevant documents with the SEC regarding the proposed merger. STOCKHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER. Stockholders may obtain free copies of the definitive proxy statement, any amendments or supplements thereto and other documents containing important information about the Company, once such documents are filed with the SEC, through the website maintained by the SEC at www.sec.gov. Free copies of the definitive proxy statement and any other documents filed with the SEC can also be obtained on the Company’s website at investors.anixter.com/financials/sec-filings or by contacting the Company’s Investor Relations Department at [email protected]
Certain Information Regarding Participants in the Solicitation
The Company and certain of its directors and executive officers may be deemed to be participants in the solicitation of proxies in connection with the proposed merger. Information regarding the Company’s directors and executive officers is contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2018, filed with the SEC on February 21, 2019, and its definitive proxy statement on Schedule 14A for the 2019 annual meeting of stockholders, filed with the SEC on April 18, 2019, as modified or supplemented by any Form 3 or Form 4 filed with the SEC since the date of such definitive proxy statement. Additional information regarding the participants in the proxy solicitation and a description of their direct or indirect interests, by security holdings or otherwise, is included in the preliminary proxy statement filed with the SEC and will be included in the definitive proxy statement and other relevant documents filed with the SEC regarding the proposed merger, if and when they become available. Free copies of these materials may be obtained as described in the preceding paragraph.
Forward Looking Statements
Certain information in this communication constitutes “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “seeks” or words of similar meaning, or future or conditional verbs, such as “will,” “should,” “could,” “may,” “aims,” “intends,” or “projects.” However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. These statements may relate to risks or uncertainties associated with:
the satisfaction of the conditions precedent to the consummation of the proposed merger, including, without limitation, the timely receipt of stockholder and regulatory approvals (or any conditions, limitations or restrictions placed on such approvals);
unanticipated difficulties or expenditures relating to the proposed merger;
the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement, including in circumstances which would require the Company to pay a termination fee;
legal proceedings, judgments or settlements, including those that may be instituted against the Company, its board of directors, executive officers and others following the announcement of the proposed merger;
disruptions of current plans and operations caused by the announcement and pendency of the proposed merger;
potential difficulties in employee retention due to the announcement and pendency of the proposed merger;
the response of customers, service providers, business partners and regulators to the announcement of the proposed merger; and
other factors described in the Company’s annual report on Form 10-K for the fiscal year ended December 28, 2018 filed with the SEC on February 21, 2019.
The Company can give no assurance that the expectations expressed or implied in the forward-looking statements contained herein will be attained. The forward-looking statements are made as of the date of this communication, and the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
Executive Vice President and CFO
Senior Vice President – Investor Relations & Treasurer
Mike Verrechia / Bill Dooley
CD&R:Thomas C. Franco
Daniel G. Jacobs