Why This Matters to Distributors: Rexel is using a combination of new stock, cash, and debt to finance its $1.4 billion acquisition of GCG, limiting how much of the deal it must fund through additional borrowing. The acquisition will significantly expand Rexel’s U.S. business and its presence in data centers, utilities, and other infrastructure markets.
Rexel plans to raise approximately €500 million ($569 million) through a new stock offering to help pay for its $1.4 billion acquisition of specialty wire and cable distributor GCG, providing the first detailed look at how the electrical distributor intends to finance the deal.
The Paris based company said on Sept. 28 that proceeds from the stock sale will partially fund the acquisition, with the rest financed through a combination of cash on hand and debt. Rexel said the financing structure is designed to preserve its credit rating and financial flexibility after the transaction closes.
Rexel announced on Sept. 25 that it had agreed to acquire GCG from Audax Private Equity. Chicago based GCG distributes specialty wire and cable, connectivity and power products and provides engineered solutions used in data centers, utilities, and other critical infrastructure markets.
The transaction values GCG at an enterprise value of $1.4 billion. GCG operates 16 locations, employs approximately 950 people, and is expected to generate more than $1.1 billion in 2026 sales, according to Rexel.
The acquisition is expected to close by the end of 2026, subject to regulatory approvals and other customary closing conditions.
The €500 million ($569 million) stock offering represents the equity portion of Rexel’s financing plan. The company said the remainder will be financed with cash and debt, although it has not disclosed the precise amount of each.
The stock sale also reduces the amount Rexel would otherwise have to borrow to complete the acquisition. Rexel said the financing plan is intended to help it maintain its credit rating and keep borrowing at approximately two times its annual earnings beginning in 2027.
Rexel is conducting the stock sale through an accelerated process available to qualified investors. Existing shareholders do not have preferential rights to purchase the new shares.
The company expects to announce the final number of shares and their issue price no later than Sept. 29 before markets open. Settlement of the new shares is expected around Oct. 1.
The offering will dilute existing shareholders who do not participate. Rexel said an investor owning 1% of the company before the offering would own approximately 0.96% afterward, assuming an issue price equal to Rexel’s Sept. 25 closing price of €36.31 ($41.34).
The financing gives Rexel a way to make one of its largest recent U.S. acquisitions without relying entirely on additional debt. It also leaves the company with greater financial flexibility as it continues expanding through acquisitions and investment in its existing operations.
GCG gives Rexel a larger position in several infrastructure markets where spending has been increasing, particularly data centers, power generation, utilities, and grid modernization. More than 60% of GCG’s sales come from markets that include data centers, power and utility infrastructure, communications, and defense, according to Rexel.
The business also extends beyond traditional electrical distribution. GCG provides engineering, custom assembly, product modification, kitting, testing and rapid fulfillment services, with Rexel saying more than 75% of GCG’s sales include products or services with additional engineering or customization.
Rexel said GCG has produced double digit annual sales growth since 2019. The company expects the acquisition to increase adjusted earnings per share during its first year of ownership.
Rexel also expects to reduce costs through greater purchasing scale, logistics improvements and moving some activities inside the combined company. It sees additional sales opportunities from offering GCG products and services to existing Rexel customers, although it has not disclosed a dollar target for those expected savings or additional revenue.
The acquisition represents a significant addition to Rexel’s U.S. operations. GCG’s expected 2026 sales of more than $1.1 billion compare with Rexel’s worldwide 2025 sales of €19.4 billion ($22.1 billion).
Rexel operates 1,876 branches in 17 countries and employed 26,306 people before the GCG acquisition. The company serves residential, commercial, and industrial customers with electrical products and services used in construction, renovation, production, and maintenance.
The GCG transaction follows other U.S. investments by Rexel as the company expands its electrical and automation distribution business. The company acquired Revere Electrical Supply earlier this year, strengthening its position in the Northeast.
GCG represents a larger move because of its size and concentration in infrastructure markets. The acquisition gives Rexel greater exposure to data centers and power infrastructure while adding specialty wire, cable and connectivity capabilities that extend beyond its traditional electrical distribution business.
Rexel’s decision to sell new stock also shows how the company is balancing that expansion against the financial cost of the transaction. Raising €500 million ($569 million) from investors reduces the portion of the $1.4 billion acquisition that must be financed through existing cash and additional borrowing.
The transaction still carries execution and financial risks. Rexel said the acquisition remains subject to required approvals and closing conditions and warned that expected benefits may not materialize on the anticipated timetable.
If the transaction closes as planned, Rexel will add a business with more than $1.1 billion in expected annual sales and a significant presence in some of the fastest growing segments of the U.S. electrical and infrastructure market. The €500 million ($569 million) stock offering is the first major step in paying for that expansion without putting the entire $1.4 billion purchase on Rexel’s balance sheet.
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