Rexel – Rexel to aquire Wasco
Rexel to acquire Wasco, a leading HVAC distributor at the heart of the energy transition in the Netherlands
Rexel announces the acquisition* of Wasco, one of the leading distributors of HVAC products and services in the Netherlands, further building its European presence to seize fast-growing electrification opportunities.
Founded in 1970 and owned by Gilde Equity Management, Wasco operates 35 branches and 2 distribution centers in the Netherlands, and generated turnover of circa €540m over the last twelve months through end-April 2023, including 60% through digital channels. With this acquisition, Rexel will double in size in the Netherlands, making it the Group’s fourth-biggest country.
Over more than 50 years, Wasco has built a strong presence on the Dutch HVAC market, which is in the forefront of Europe’s energy transition, driven by national regulations. The conversion from gas boilers to electrical heat pumps has allowed Wasco to post double-digit growth over the past few years and will further support sustainable demand. This acceleration in the energy transition also leads to increasing proximity between the HVAC and electricity markets in the Netherlands, both at installer and distributor level, enabling more cross selling opportunities.
The Wasco acquisition will allow Rexel to benefit from energy-transition related opportunities. Those markets (HVAC in the case of Wasco but also photovoltaic solutions, industrial automation or EV charging solutions), whose growth is substantially above Rexel’s in other markets, should also bring resiliency as they are driven by corporate agendas to reduce their emissions, as well as government incentive plans. Rexel has already developed a successful HVAC business, concentrated in countries where heating is traditionally electric, such as France.
With an enterprise value of €485m, the implied multiple stands at 9.2 times Wasco’s EBITDA or less than 7 times after full realization of the expected synergies, notably including cross-selling opportunities and logistics optimization. The transaction is expected to be accretive in year one to Rexel’s adjusted EBITA margin and EPS as well as value creating in year two, fully in line with the Group’s criteria. The transaction will leave Rexel’s indebtedness ratio significantly below 2 times EBITDAaL on a proforma basis. It is in line with the capital allocation strategy outlined at the 2022 Capital Markets Day and fully compatible with the ongoing share buyback program
“With the acquisition of Wasco, we are totally in line with our strategy aiming at seizing electrification and energy transition opportunities. It’s also fully consistent with our purpose, ‘Electrifying solutions that make a sustainable future possible’. The Netherlands is one of the most exciting European markets from an electrification perspective, benefitting from a fast-paced transition from gas, driven by incentives and regulations, notably the ban on gas boilers both in new build and renovation. Wasco is ideally positioned to be an active player in this transition; it is also best-in-class in terms of digitalization. We are excited to start working with the Wasco teams to unleash the great opportunities that the association of both companies in the Netherlands will create. This transaction demonstrates that Rexel continues to carefully select the best development opportunities, accelerating its growth related to electrification in Europe and reinforcing its positioning in the US, through both organic initiatives and small-to mid-size value-creating acquisitions.”
Guillaume Texier, CEO of Rexel
* The acquisition remains subject to customary conditions including completion of the consultation process of Wasco’s works council and approval by the competition authority, i.e. the European Commission. It is expected to close in the second half of 2023.
More information on Rexel: See the full profile on EMR Executive Services
More information on Guillaume Texier (CEO, Rexel): See the full profile on EMR Executive Services
More information on Laurent Delabarre (CFO, Rexel): See the full profile on EMR Executive Services
More information on Gilde Equity Management: https://www.gembenelux.com/ + Gilde Equity Management is an independent private equity company that invests in businesses that are rooted in the Benelux and have international aspirations. We do this in cases of business succession, privatization or management buyouts. We love companies that are fuelled by a love for what they do. Where people are proud of what they do or make. Where entrepreneurship is key. We invest capital, energy and our trust to help these companies and their management to flourish all over the world. The typical transaction value of our investments ranges between € 20 and € 200 million.
More information on Gerhard Nordemann (Managing Partner, Gilde Equity Management): https://www.gembenelux.com/partner/gerhard-nordemann + https://www.linkedin.com/in/gerhard-nordemann-571329a7/
More information on Wasco: https://www.wasco.nl/ + Wasco, owned by Gilde Equity Management, is the most customer-oriented wholesaler of heating, plumbing, air conditioning, ventilation and parts. With more than 50 years of experience, Wasco is a household name in the installation industry. Wasco unburdens its customers with sober and professional advice, surprisingly innovative solutions and fast, error-free delivery. The user-friendly webshop offers a very extensive range of more than 500,000 products. Wasco has two large distribution centers and is always nearby with 35 branches.
EMR Additional Notes:
- HVAC-R (Heating, Ventilation, and Air Conditioning – Refrigeration):
- Heating, ventilation, and air conditioning is the use of various technologies to control the temperature, humidity, and purity of the air in an enclosed space. Its goal is to provide thermal comfort and acceptable indoor air quality.
- HVACR involves maintaining, repairing and installing heating, ventilation, air conditioning, and refrigeration systems.