Ratings on Arrow Electronics, Inc. reflect a strong market position, highly competitive industry conditions, and weakened debt protection measures. Melville, N.Y.-based Arrow has built its position as one of the leading global electronic components and computer products distributors through ongoing acquisitions. However, electronic industry component pricing and demand are expected to be weak in the near term, reflecting economic weakness and reduced levels of technology spending. Arrow reported a 23% sequential revenue decline in the quarter ended June 2001, and effectively break-even net profitability, compared to a net margin of 2.8% in fiscal 2000. Arrow has historically made acquisitions to enhance its market position and is expected to continue to be acquisitive. While acquisitions have historically been financed largely with
