WESCO International, Inc., Pittsburgh, has agreed to acquire TVC Communications LLC (TVC), Annville, Pa., from Palisades Associates, a Bethesda, Md.-based private equity firm, for approximately $246.5 million. The transaction, expected to close by year-end, is subject to customary closing conditions and regulatory approvals.
TVC is a distributor of broadband communications network infrastructure products serving the cable, telecommunications and satellite industries. TVC's annualized sales as of Oct. 31, 2010, were approximately $300 million, the company said. It employs over 300 people and operates 20 locations serving markets in the United States, Canada, Latin America and Europe.
The TVC operations will continue to operate under James Manari, president and chief operating officer of TVC prior to the acquisition, and the existing leadership team under the TVC name. It will report through WESCO's Data Communications business, which the company has built around Communications Supply Corp. (CSC), a datacom distributor WESCO acquired in late 2006, said Richard Heyse, WESCO's V.P. and CFO.
“The addition of TVC will make WESCO the leading one-stop shop for enterprise and telecommunication infrastructure solutions by providing the necessary products to support the entire broadband network, from signal origination to and through the customer premises,” Stephen Van Oss, WESCO's senior vice president and chief operating officer, said in a release. “TVC has a track record of success, and an experienced management team that will report to David Bemoras, vice president and general manager of our Data Communications and Security business. We are looking forward to the addition of this seasoned and energetic management team to WESCO.”
Heyse said the company would consider combining TVC locations with existing WESCO and CSC locations where it makes sense, a strategy the company has recently adopted with its Carlton-Bates subsidiary — a distributor of industrial supplies and factory automation products. “We will consider combining sites where it creates a more robust market capability for the local market,” Heyse said.
TVC, which was advised in the deal by Jefferies & Co., New York, stands to gain from the association with WESCO, Manari said. “We are excited to have the opportunity to be part of the WESCO organization, with its outstanding logistics capabilities and broad product and service offerings. The combined resources of our companies, in addition to our industry knowledge, experience and excellent customer service, will provide a terrific value proposition to both our customers and our loyal manufacturing partners.”
Among the benefits for WESCO is TVC's geographic reach, said WESCO president and CEO John Engel. “TVC strengthens WESCO's data communications platform by providing a more comprehensive suite of products and services to existing and new customers, while expanding our geographic footprint into previously untapped international growth markets.”
The acquisition will be financed utilizing WESCO's existing cash and credit facilities, Engel added.