General Cable Corporation (NYSE: BGC) (the Company) announced today that it has completed the acquisition of Alcan Cable China. Alcan Cable China represents approximately 10% to 15% of overall revenues of Alcan Cable.
“Alcan Cable China has a 430,000 square foot, vertically integrated manufacturing plant in Tianjin, China and ten regional sales offices. Since its start-up in 2007, the business has matured in a relatively short amount of time building a sales infrastructure and a premium brand with a strong reputation in the Chinese market, which represents nearly one-third of global wire and cable demand. We believe the synergies of this acquisition coupled with an established platform from which to introduce and grow other General Cable product lines further enhances the value proposition to our customers. We are honored and proud to become part of General Cable,” said Alex Tham, Managing Director, Alcan Cable China.
“We are pleased to have completed the second and final step of the acquisition of Alcan Cable. We have brought together two companies with more than 200 years of combined experience in the wire and cable industry serving important markets in North America and now China. Alcan Cable China is highly complementary to our two long-standing partnerships in China and continues to generate positive momentum in the market. We are off to a fast start executing on our integration plans in North America and expect to do the same with the business in China,” said Gregory B. Kenny, President and Chief Executive Officer of General Cable.
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 businesses as manufacturing, logistics, and purchasing synergies are realized. The Company expects Alcan Cable North America to contribute meaningfully in the fourth quarter of 2012 while Alcan Cable China’s contribution is expected to be de minimis to fourth quarter results as step-up purchase accounting adjustments offset the base earnings in the business in China.
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