Distribution: Avnet Extends Cash Offer to Acquire UK Premier Farnell

Avnet, Inc. has reached agreement with the board of directors of Premier Farnell plc on the terms of a recommended offer for Premier Farnell by Avnet or one of its wholly-owned subsidiaries.

The all-cash offer of £1.85 per share represents an equity value of approximately £691 million and a 12.1% premium over the previous offer of £1.65 per share by Datwyler Technical Components UK Limited.

Headquartered in Leeds, UK, Premier Farnell is a global distributor of electronic components and related products delivering engineering solutions to the electronic system design community utilizing multi-channel sales and marketing resources.

The transaction is intended to be effected by means of an English court-sanctioned scheme of arrangement and is subject to satisfaction or waiver of several conditions, including the approval of Premier Farnell shareholders and the court, receipt of regulatory approvals in the European Union, United States and Israel, and other customary conditions.

“This acquisition will strengthen Avnet’s digital footprint worldwide. The convergence of Premier Farnell’s innovative online services with Avnet’s world class supply chain will create customer service unparalleled in the industry,” said William Amelio, interim CEO, Avnet. “The talented team of people at Premier Farnell will allow Avnet to enhance our customer experience and accelerate our global growth.”

Upon completion, the transaction is expected to be accretive to earnings even before considering positive effects from any synergies realized, and supports Avnet’s return on capital goals.

“Premier Farnell will bolster our strategy to provide a differentiated digital experience from product ideation through its lifecycle. Premier Farnell’s customers gain access to an extensive suite of supply chain services allowing them to ramp new products to production volumes. Our customers will be able to do more technical research online through the services provided by Premier Farnell,” said Gerry Fay, president, Avnet’s electronics marketing, worldwide “Bringing these two companies together allows us to capture market share earlier in the design process.”

Fay further added: “In addition to deepening our customer base, this acquisition will enhance our go-to-market strategy as we target the industrial IoT with edge-to-enterprise products and solutions.”

Bank of America Merrill Lynch acted as financial advisor and Gibson Dunn & Crutcher LLP acted as legal counsel to Avnet in connection with this transaction.