General Cable Corporation (NYSE: BGC) (the Company) announced today that it has completed the acquisition of the North American portion of Alcan Cable for $151 million, subject to customary adjustments primarily related to working capital levels at closing. The North American portion of Alcan Cable represents approximately 85% to 90% of overall revenues of Alcan Cable. As anticipated in the purchase agreement, the Company expects to complete the acquisition of the business operating in China for $34 million in a separate and subsequent closing before the end of 2012, subject to receipt of regulatory approval and customary closing adjustments. The Company estimates that the overall Alcan Cable business will contribute approximately $650-$700 million in annual revenues at current aluminum prices, and over a cycle, the operating margin profile is expected to be consistent with the Company’s existing North American businesses. The Company expects the acquisition to be accretive on a full year basis and will provide a more detailed view of the expected contribution to 2012 including the impact on the third and fourth quarters in conjunction with its third quarter earnings release in late October.
“We welcome Alcan Cable associates to General Cable and look forward to immediately sharing best practices as we realize manufacturing, logistics, and purchasing synergies created by this acquisition. Expanding our product portfolio through an enhanced aluminum-based cable offering further strengthens the value proposition to our electrical distributors and utility customers alike. The addition of aluminum rod and strip manufacturing provides vertical integration benefits as well as a new segment of valued OEM customers,” said Gregory J. Lampert, President and Chief Executive Officer, General Cable North America.
The acquisition will be funded utilizing the Company’s recently amended and enlarged asset-based revolving credit facility and cash on hand. In addition to funding the acquisition of Alcan Cable, the amended credit facility supports the Company’s existing global operations while at the same time providing continuing flexibility to address other elements of the capital structure, subject to meeting minimum availability and fixed charge coverage requirements. In accordance with the recent amendment, the credit facility increased to $700 million with the closing of the North American portion of Alcan Cable.
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