SUMMARY OF REPORT CONTENTS

The share for the UK, for example, appears very low in relation to the relative size of the construction market as most companies have limited involvement in appliances compared to other countries. However, in overall terms, the EU electrical wholesaling market has been relatively buoyant in 2006 / 07, with most countries experiencing good growth. Construction activity has risen in most countries, with both housebuilding and non-housing sectors performing well. Germany, in particular, has experienced an upturn in activity after several difficult years, while Netherlands, France, Belgium and the UK have all performed well. As a result, many companies entered 2008 with optimistic forecasts of the prospects for both construction in general, and electrical wholesaling in particular, though these have since been tempered by a general deterioration in the economic climate in most countries.

The key issue will be assessing the length and severity of any downturn, which will vary between countries. The Eurozone is still performing relatively well into April / May 2008, though construction is experiencing significant difficulties in Spain and Ireland which is expected to spread to other countries, such as France and the UK. Ultimately, the length of any downturn will be driven by the timing of the easing of the global credit crisis and inflationary pressures – both global issues and outside the control of individual countries - though responses to the problems do vary between the countries.

In the last edition of this report, AMA commented that 3 leading multi-national wholesale groups - Sonepar, Rexel and Hagemeyer - had a reasonably strong presence in several markets. In 2008, the takeover by Rexel of Hagemeyer, and the related asset swap and acquisitions involving Sonepar, will see this reduce to just 2 companies – Sonepar and Rexel. Sonepar and Rexel are both based in France with high market shares in their home market and a leading presence in other EU and international markets. The 2008 Rexel/Hagemeyer acquisition will significantly affect several markets and has resulted in a complex re-arrangement of assets to avoid competition problems in different countries.In particular, with regard to this report, notable changes will occur in market structures in Germany, Belgium and the Netherlands, whilst the French market, already highly consolidated, will not be significantly impacted by the changes as Hagemeyer is not represented in France.

In most markets, buying groups are relatively strong, but in general there has been consolidation among buying groups as well as among individual companies.The introduction of the Euro and emergence of large customer groups with Pan-European operations are just two factors encouraging the formation of international wholesalers capable of providing the level of pricing, service and support required.

Finally, this report reviews recent developments in the supply trends in each of the markets, illustrating the current position of the leading wholesalers and identifying areas of potential change in the future. Market conditions in the electrical wholesaling market in 2008 are set to become more challenging in all countries, with housing-related sectors most under pressure and rising raw material costs feeding through the supply chain. Longer term prospects, however, remain optimistic driven by sustained growth in construction, higher specification products, and energy and sustainability issues impacting positively on demand.

AMA Research’s “Electrical Wholesale Market – Western Europe 2008-2012” report is available in hard copy or electronic format for £745 and can be ordered online at www.amaresearch.co.uk or by calling 0871 3103450.