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RS Group PLC on Wednesday said it has agreed to buy Risoul y Cia SA de CV for a cash consideration of $275 million on a cash-free and debt-free basis.
Risoul is a family-owned distributor of industrial and automation product and service solutions in Mexico.
The FTSE-100 industrial and electronic products distributor, formerly known as Electrocomponents, said the deal ‘significantly strengthens’ its position in Mexico, and it is expected to deliver significant revenue synergies.
‘We are excited about deepening our presence in Mexico and having a strong platform to expand into Latin America, a region we can see benefiting from nearshoring owing to de-globalisation and a greater focus on improving sustainability through reducing distances products travel,’ RS added.
For the year that ended on September 30, Risoul generated revenue of $166 million and earnings before interest and tax of $19 million.
RS said the acquisition will be financed from its existing debt facilities, due to be completed by November 2022.
Chief Executive Officer Lindsley Ruth said: ‘We are accelerating our organic growth with bolt-on acquisitions that meet our key strategic, financial and cultural criteria. Risoul enables RS to expand our position and execution expertise in the Americas, specifically in Mexico and the rest of Latin America, and drive cross-selling synergies across our product and service solutions offer.’
Shares were up 0.6% at 1,023.00 pence on Wednesday morning in London.
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