Hughes Supply Inc., Orlando, acquired Utiliserve Holdings Inc., and its subsidiaries, including Utili-serve Inc., a Corinth, Texas, electrical transmission and distribution products distributor. The stock purchase deal is valued at about $90 million in cash.
Utiliserve Inc. was formed in 1999 when Temple Holding Co., Corinth, Texas, acquired Vanyo Inc., Somerset, Pa.; Power Supply Inc., Matthews, N.C.; National PowerX, Solon, Ohio; and Rigby Electric Supply, Kingstree, S.C. Utiliserve Inc. also includes two related divisions, metering and recloser/hydraulic tool repairs.
Utiliserve, which expects to generate sales of approximately $230 million for the year ending Dec. 31, 2002, serves public/municipal utility districts, rural electric cooperatives and investor-owned utilities located in 15 states in the Central, Southwest and Mid-Atlantic regions of the United States. Utiliserve's majority shareholder is Code Hennessy and Simmons, a Chicago-based private investment firm that, along with management, acquired Utiliserve in 1997.
Hughes has more than 439 locations in 34 states. In its fiscal year ended Jan. 25, Hughes sales reached $3.04 billion. Before the acquisition, Hughes did about 6 percent of its business in utility products. The acquisition will increase its utility product sales to about 13 percent, said Steve Zepf, Hughes' chief financial officer. The acquisition will also expand Hughes's geographic coverage to include the East Coast and some new states in the West, he said. The new markets for utilities will be Delaware, Kansas, Missouri, North Carolina, Oklahoma, Pennsylvania, South Carolina, Texas and Virginia.
Hughes currently operates its utility business as a separate division of its electrical group, according to Zepf. He would not comment on whether the company plans to make any changes in how it operates its utility business.