COLLIERVILLE, Tenn. - Mueller Industries, Inc. (NYSE: NYSE:MLI), a key player in the industrial sector, has announced a definitive agreement to acquire Nehring Electrical Works Company and its affiliates for a total consideration of approximately $575 million, with an additional $25 million earn-out clause.
Nehring, a company with roots dating back to 1912, is recognized for its high-quality wire and cable products serving various markets including utility, telecommunications, and electrical distribution.
The acquisition, which is set to enhance Mueller's portfolio, is expected to provide a robust platform for growth in the electrical and power infrastructure sectors. According to Greg Christopher, CEO of Mueller Industries, Nehring's operational culture aligns with Mueller's, and their expertise in copper and aluminum extrusion is expected to yield synergies for both entities.
Nehring reported annual net sales of around $400 million for the year ending December 31, 2023. The company operates through Nehring Electrical Works Company, Conex Cable, L.L.C., and Unified Wire & Cable, Inc., and is a trusted supplier across the United States.
Christopher expressed confidence that the acquisition will be accretive to Mueller's financial results for 2024. He also highlighted Nehring's healthy margin and cash flow profile, which, coupled with ongoing investments, positions it to capitalize on the expected surge in infrastructure investments.
The transaction, which will be financed with cash on hand, is anticipated to close in the second quarter of 2024, pending regulatory approval and other customary closing conditions. Post-acquisition, Mueller intends to maintain a strong cash reserve to support further growth initiatives.
Mueller Industries, with its network of companies and brands, serves critical sectors such as climate control, energy transmission, and medicine, to name a few. The company's footprint extends across North America, Europe, Asia, and the Middle East.
This news is based on a press release statement from Mueller Industries, Inc.
InvestingPro Insights
Mueller Industries, Inc. (NYSE: MLI) is poised for a strategic expansion with the acquisition of Nehring Electrical Works Company, a move that could further solidify its position in the industrial sector. As the company prepares for this significant venture, let's delve into some key financial metrics and insights from InvestingPro that may interest investors.
InvestingPro Data highlights Mueller Industries' robust financial health with a market capitalization of $5.94 billion, suggesting a significant presence in the market. The company's Price to Earnings (P/E) ratio stands at 9.65, which indicates that the stock is trading at a lower earnings multiple compared to some of its peers—potentially signaling an attractive valuation for investors. Furthermore, the company's dividend yield is currently at 1.53%, reflecting its commitment to returning value to shareholders.
InvestingPro Tips reveal that Mueller Industries holds more cash than debt on its balance sheet, providing it with financial flexibility and strength to pursue growth opportunities such as the Nehring acquisition. Additionally, the company has not only raised its dividend for 3 consecutive years but has also maintained dividend payments for an impressive 21 consecutive years, showcasing its reliability and dedication to shareholders.
Investors interested in a deeper analysis of Mueller Industries, including additional InvestingPro Tips, can explore the full suite of insights available on https://www.investing.com/pro/MLI. There are 12 more InvestingPro Tips listed for Mueller Industries on the platform, offering a comprehensive perspective on the company's financial and operational performance.
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