Bell Industries Inc.'s shareholders last week approved the sale of the company's $500 million Electronics Distribution Group to Arrow Electronics Inc. for $185 million in cash.
With this approval, Arrow will close its second acquisition this month. In January, Melville, N.Y.-based Arrow completed the acquisition of Richey Electronics Inc., Garden Grove, Calif.
Bell, based in El Segundo, Calif., expects to use a portion of the cash to pay off debt, taxes, and related closing costs. It also plans a cash distribution to shareholders of $50 million to $60 million 90 days after the transaction is completed, which is expected to occur within the next three to five business days.
Arrow's new business group, Arrow/Bell Components, will be based in Melville and will have field-sales offices across North America. The group will serve small and emerging customers with a full line card of semiconductor, industrial computer, and IP&E (interconnect, passive, and electromechanical) products.
Arrow/Richey, which supports customers' IP&E needs, will be merged with Arrow's PEMCO group and headquartered in Denver.
With both deals completed, Arrow expects to run the acquired businesses as independent entities over the next three months as it resolves various issues, including integration with its computer systems and personnel.
Also pending will be several line-card-related issues, as the acquisitions have resulted in the commingling of lines that in the past have refused to be sold side by side through the same distributor. Key among them are AVX and Kemet, and Motorola and several Asian semiconductor lines.
Bell's principal remaining business will be its systems integration group, whose services include network design and engineering, software-licensing support, microcomputer-systems analysis, help-desk support, product configuration and deployment, and asset management. Bell also has two manufacturing divisions that provide specialized computer and electronic products, and it operates a recreational-products group that distributes aftermarket parts and accessories for RV, marine, and other industries.
Arrow will situate the new acquisitions' field-sales offices in six regions (Northeast, Southeast, North Central, South Central, West, and Canada), and is expanding Arrow Semiconductor's locations as well. In total, the new offices represent a 25% increase in Arrow's North American coverage. The company's other five groups-Arrow Alliance, Arrow CMS (Contract Manufacturing Services) Distribution, Arrow Industrial Computer Products, Arrow Supplier Services, and Arrow/Zeus Electronics-will maintain their existing locations.
In other news, Arrow last week announced the appointment of Sam R. Leno as senior vice president and chief financial officer, replacing Gerald Luterman. Leno was previously executive vice president and chief financial officer of Corporate Express Inc., a supplier of office products, desktop software, and delivery services. Prior to that, he spent 24 years in the health-care industry.