WESCO International, Inc.
) announced its agreement to acquire LaPrairie, Inc. for an
undisclosed amount. The deal is expected to be closed in
Headquartered in Canada, LaPrairie distributes high-voltage
electrical products and services for transmission, distribution
and substation needs for utilities and utility contractors across
Ontario, Quebec and Atlantic Canada. The company generates annual
sales of approximately $30 million from a single location in
The LaPrairie acquisition will bolster WESCO's presence in
Canada through the expanded utility business and customer base.
WESCO has been operating in the Canadian market since 1922 with
employee strength of about 1,100. In 2012, the company generated
approximately 17% of revenues in Canada with annual sales of
$1.08 billion ($900.6 million in 2011 or up 20% year over
The acquisition is also expected to be accretive to WESCO's
earnings. It will likely add 3 cents per share to the company's
profit in the first year of operation.
WESCO is quite active on the M&A front. Last year, WESCO
acquired RS Electronics, which expanded the company's industrial
OEM (original equipment manufacturer) customer base and enhanced
its electronic-based product offerings. In July, WESCO acquired
British Columbia-based Trydor Industries (Canada) Ltd., a
distributor of high-voltage electrical, industrial, utility
products to strengthen its industrial and utility market position
The company's acquisition pipeline remains quite robust with
opportunities to further expand and strengthen its portfolio.
WESCO is one of the largest suppliers and distributors of
electrical construction products in the United States. The
company's third-quarter earnings and revenues were up a
respective 17.8% and 16.6% year over year. The improvement was
aided by acquisitions, partially offset by a reduction in organic
sales and unfavorable currency movements.
Currently, WESCO has a Zacks Rank #3 (Hold). Other
better-ranked stocks that are performing well at current levels
Montage Technology Group Limited
). All these stocks carry a Zacks Rank #2 (Buy).
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