Madison Joins Southwire Family

Southwire, known for their wire and cable offering, has been on the expansion trail the past few years broadening its offering into tools, material handling (Maxis Tools)  and a couple of years ago Garvin Industries, which was a head scratcher of an acquisition to many due to its go to market strategy at the time and diverse product offering, and ProBuilt Professional Tools.

Essentially the acquisitions have been bolt-ons and have been perceived as what they are … nominal (tools was an organic initiative reportedly originally designed to support Lowes).

In a 2018 ElectricalTrends article we foreshadowed that Southwire could become an industry aggregator. While their deals, other than wire / cable ones, have been small, financially, their recent Madison deal could provide a product platform to grow from.

According to Southwire’s press release:

Supporting the company’s growth strategy, Southwire is pleased to announce the acquisition of Madison Electric Products LLC of Solon, Ohio – a manufacturer of high-quality, electrical components and accessories.

Madison Electric is widely recognized for designing high-quality, innovative electrical products for the professional, including SmartLB™, Smart Box™, Draft Seal™, Pull-It™ and other well-known brands. A large portion of these products come from its Sparks Innovation Center™ interface, a crowd-sourcing approach to product development, which allows electricians to submit new product ideas. This has contributed to a strong pipeline of new and innovative products that are focused on helping the electrician.

 “Madison’s breadth of products and solutions are a strong complement to our growing tools, components and assembled solutions portfolio,” said Rich Stinson, Southwire’s president and CEO. “As I’ve said many times, it is our goal to remain generationally-sustainable for the next 100 years and beyond. The opportunities and innovations that the Madison team brings will support us on this journey.”

The purchase of Madison Electric includes a headquarters operation in Solon, Ohio and a state-of-the-art warehouse and distribution facility in Duluth, Ga. 34 employees will join the Southwire team through this acquisition.

“Madison Electric, with its focus on innovative products through its Sparks Innovation Center portal, is a tremendous fit with our growing components product line and the rest of our Tools, Components and Assembled Solutions,” said Brandon Moss, executive vice president of Southwire’s Tools, Components and Assembled Solutions business group. “We are excited to add Madison Electric Products to Southwire’s product line and look forward to better serving our customers with our ever-growing line of solutions focused on the professional.”

Madison has been a nice little creative company focused on product innovation that, according to distributors, was easy to do business with. They were entrepreneurial and, while they weren’t part of a marketing group, independent distributors liked doing business with them.

With their product offering, access to marketing groups as well as national chains, the Madison offering could turn out to be a “diamond in the rough” for Southwire, if well managed, and a thorn for many others.

Madison’s product offering of 2700 SKU’s includes rigid and IMC conduit fittings, liquid tight fittings, NM fittings and supports, grounding, bonding and splicing, conduit bodies, hangers and supports, service entrance hardware, and wire handling solutions.  As mentioned in the press release, Madison utilized a unique crowd sourcing approach to engage contractors for some of their product development.

It will be interesting to see how Southwire seeks to grow this business while maintaining Madison’s culture of innovation. And what will the next acquisition be as reportedly they’ve recently “lost” on a couple of others, indicating they are on the acquisition trail.