Elliott buys Key Electrical & two Treadway locations
Elliott Electric Supply, Nacogdoches, Texas, expanded its operations to 108 locations in the Gulf Coast and south-central U.S. with acquisitions of two branches from Treadway Electric Co., Little Rock, Ark., and the one-location distributor Key Electrical Supply, Houston, formerly owned by Integrated Electrical Services Corp. (IES), a national electrical contractor based in Houston.
Elliott Electric has grown quietly but relentlessly over the decades, preferring to open “green-field” locations with its own lines, its own inventory and its own hand-picked people. The company typically opens six or seven new branches each year, sometimes as many as a dozen in a year.
Sometimes, however, an acquisition just makes more sense. Toward the end of last year, Elliott found two such acquisition opportunities. Treadway Electric had two locations that weren't fitting in with the company's core business, located in areas where Elliott didn't already have competing branches.
Elliott and Treadway are both members of Imark Group, the Bowie, Md.-based distributor buying and marketing group, and it was through Imark that Bill Elliott, Elliott Electric's president, first learned of the opportunity. Imark has a program called “Imark First” to encourage any members contemplating a sale to confidentially explore merger and acquisition opportunities with other Imark members. “It's a way to keep members within the organization, if possible,” Elliott said.
Meanwhile, IES was interested in divesting its ownership in Key Electrical Supply. Key Electrical Supply was one of the few electrical distributors in the country owned by an electrical contractor, a situation that came about in the late 1990s when IES was rolling together a number of smaller contractors. By last year, IES had come to consider Key as a non-strategic asset.
Elliott Electric Supply had discussed acquiring the Key Electrical Supply operations with IES before, but hadn't been able to come to an agreement. The companies nonetheless were a good fit, both being Cutler-Hammer distributors focused on residential and light-commercial projects.