Sonepar Increases Share in Boston, Acquires ESC

Last week, Electric Supply Center (ESC) and Sonepar’s NorthEast Electrical group announced that ESC was acquired by NorthEast.

ESC, ranked last year as #98 on the EW Top 150, which would slot them around $100M, had, according to others in the market revenues of between $150-170 million dollars and operated six locations, of which a couple where more appropriately considered “offices.” ESC was an AD member.

A quality, aggressive and progressive company, ESC is known for strong relationships at key contractors in the Boston marketplace and a Siemens success in winning projects in the Boston marketplace.

Coupled with NorthEast, it’s projected that the combined entity will result in a $700-750 million OpCo. This is important given Sonepar’s desire for each OpCo to be a $1 billion entity.

The New England market was projected to be slightly over a $5 billion market according to Electrical Wholesaling’s 2024 market planning issue. This would mean that Sonepar now has 15% market share.

The New England market, defined as the six states and now upstate New York, which had many independents, is now 60% controlled by nine companies (CED, WESCO, Rexel, Sonepar, USESI, Graybar, City Electric, Green Mountain and Granite City Electric).

According to the press release, the deal is projected to close the end of June. Feedback in the marketplace is “no changes”. A note that Larry LaFreniere, President of ESC, shared on LinkedIn states, “ESC will continue to thrive”, “we will figure out how to best grow together” and “I am getting to the end of my career.” He further states, “his competitive juices have not dried up”, “plan to stay on” and that “it was especially important to me that all of you have the best chance for personal and professional growth.”

Here is what Larry shared with ESC customers:

And their joint letter to the supplier community:

From hearing rumors of a selling price, that ESC had been speaking with parties in the market for a bit and that there was at least one other interested party, and the “back of the envelope” math that many have done, Sonepar paid a significant price to acquire the business. Based upon observing Sonepar in other markets, it is expected that they will work through an integration process that will start with the back of the house and eventually work to identify pricing opportunities with common customers. The acquisition provides NorthEast with access to talented people, which could help fill openings that they may have had, hence strengthening the overall company. Eventually they’ll seek warehousing synergies (NorthEast has a 400,000 square foot warehouse in Stoughton which may or may not be able to accommodate more … but maybe more turns, hence an efficiency / consolidation opportunity.) And, eventually, because it has occurred at other OpCos, management and some personnel redundancy opportunities will be realized. It is doubtful that the ESC name lasts long-term given Sonepar’s drive to develop platforms.

Congratulations to Larry, the ESC team and to NorthEast.

Unfortunately, another reason why this year’s Electrical Wholesaling top distributor list is now a Top 100!