Melville-based MSC Industrial Direct Co., one of Long Island's largest companies, said Friday it has agreed to acquire a distribution unit of a Connecticut company for $550 million.
MSC said the acquisition would nearly double its sales staff and help push it toward its goal of $4 billion in sales by 2016. MSC, Long Island's seventh-largest company by revenue, first hit $2 billion in revenue in its fiscal year 2011.
The company, which distributes industrial tools and supplies, has signed a definitive agreement to acquire Barnes Distribution North America, which is based in Cleveland. It is a unit of Bristol, Conn.-based Barnes Group Inc. MSC said it would pay for the purchase with cash and loans.
"This transaction, along with our expected long-term organic growth, will help us achieve our goal of $4 billion in revenue by 2016," said chief executive Erik Gershwind.
MSC also plans to break ground this spring on a previously announced 400,000-square-foot distribution center in Columbus, Ohio. It will employ 300 full-time workers by the end of 2017.
The Barnes unit distributes what MSC executives call low-cost, high-margin products such as fuses and fittings and specializes in inventory-cost management. The division has about 31,000 customers in sectors that include government and manufacturing. Its estimated 1,400 employees include more than 800 sales people. The division had about $300 million in sales in 2012.
"We are getting a well-run, high-margin business," said Jeff Kaczka, MSC's chief financial officer.
MSC has nearly 5,000 employees, including 664 on Long Island. MSC stock closed at $85.24 a share, up $2.15 Friday in New York Stock Exchange trading, near its 52-week high of $86.81.