Despite closures, 'business as usual' at Bindley Western
WESTBROOK, Maine - Bindley Western has seen half of its 16 distribution centers shuttered, including one here slated to close next month, but that's just "business as usual" for a company that's been recently acquired, according to industry sources.
"I don't think it's anything out of the ordinary," said one source. "In a merger, especially one between two top dogs like Bindley and Cardinal, you can expect a 25% to 50% cut in the number of warehouses. I'm sure this was slated to happen from the get go."
The Dublin, Ohio-based Cardinal Health acquired the Indianapolis-based Bindley Western in a stock-for-stock transaction valued at $2.1 billion in February 2001. Together, the companies reportedly have some 34 distribution centers.
Industry sources say Bindley Western's Westbrook, Maine, distribution center, at 118,000 square feet, is the biggest yet to be shuttered. They say operations will be moved to other facilities in Bindley and Cardinal's distribution network.
"It appears to be a typical consolidation move as a result of an acquisition," said one source.
Where there's cause for concern, however, is whether Cardinal will retain Bindley's sales force, one source said. Bindley customers are loyal, and they don't want to deal with just any rep, he said. But other sources say consolidation among sales teams is not only normal for two companies merging, it's also a trend in the industry.
"It shouldn't be anything to worry about," one source said. "You don't change wholesalers like you change your underwear. It involves too much work." HME