Rexel (RXL) investor relations material

Deal rationale and strategic fit

• Expands North American presence, making it over 50% of group turnover post-acquisition, up from 35% in 2021, and adds a $1.1 billion sales platform focused on high-growth segments like data centers, utilities, grid modernization, and defense.

• Over 60% of target's turnover is in high-growth segments, with 75% of sales being value-added products and services, enhancing customer stickiness and moving up the value chain.

• GCG’s value-added solutions and engineering depth complement existing capabilities and open new verticals, supporting upstream participation in product design.

• Fully aligns with electrification megatrends and the strategic roadmap to accelerate growth in core geographies and resilient, fast-growing markets.

• Reinforces position in diversified markets, including new exposure to power, utilities, and defense.

Financial terms and conditions

• Enterprise value of $1.4 billion (circa EUR 1.3 billion), financed with two-thirds cash/debt and one-third equity, including €800 million debt and up to €500 million equity raised via accelerated book building.

• Debt financing is fully underwritten, and the acquisition multiple is less than 8x EBITDA or EBITDAAL post run-rate synergies.

• EPS accretive in year 1, with value creation and ROCE above WACC expected by year 3.

• Leverage expected to remain around 2x net debt/EBITDA or EBITDAAL by end of 2027, maintaining a strong balance sheet.

Synergies and expected cost savings

• High level of cost synergies identified, mainly from logistics, purchasing, back office, digital/AI tool optimization, and insourcing.

• Revenue synergies not included in business plan, but significant cross-selling and commercial expansion opportunities exist.

• Synergy estimates are at the high end of historical acquisitions as a percentage of sales, with EBITA margin accretive by over 20bps.