Avnet has completed its acquisition of Premier Farnell. It is described as an all cash merger for £1.85 per share, which equates to an equity value of approximately £691m. The acquisition was approved by Premier Farnell shareholders representing 99.9% of the votes cast and has received all regulatory approvals. Avnet says that the transaction is expected to be immediately accretive to earnings and, once the integration is complete, expects to generate annual synergies of approximately $70m to $80m.
“The combination of Premier Farnell with Avnet’s components business will create a truly unique distribution model that supports customers at every stage of the product lifecycle. By pairing our deep expertise in large volume broadline distribution with Premier Farnell’s specialisation in proof of concept and design, we can offer true end-to-end solutions that accelerate a customer’s time-to-market and moves their products seamlessly from prototype through to volume production,” said William Amelio, Chief Executive Officer of Avnet. “As technology reaches deeper into more products and innovation proliferates through the internet of things, the ability to reach a wider base of engineers earlier in the design process will be critical to our future growth and success.”
The deal comes at a good time for Premier Farnell shareholders who have endured a bumpy ride of late.
Avnet’s prize is access to the Farnell element14 community of more than 430,000 electronics professionals in 36 countries and multi-channel sales and marketing resources that combine traditional field sales and contact resources with innovative ecommerce interfaces.
Avnet’s longer-term strategy will be engage with customers from the concept and design stage through to production where Avnet can meet customer demands for larger production volume of components.