Our bar is high so it takes a lot to get over our bar in terms of what meets our criteria. In terms of — I want to make a specific comment with respect to using the full amount of the $300 million approximately after-tax proceeds from the WIS divestiture on a buyback. I mean, the way to think about that is it’s a combination of our confidence in our business plan, our execution of those business plans and our outlook, coupled with the fact that we believe — strongly believe we’re trading far below our intrinsic value. So we think taking the full $300 million and applying it to a buyback is the best return on investment by far, given where we are trading. So with that, Dave, I think I hit most of his comments, but you may want to —
Dave Schulz: Yes, certainly. So in terms of how we think about capital allocation between buying back shares, which John mentioned, is usually around intrinsic value versus continuing to delever, particularly given the interest rate environment versus M&A, we have a very high bar on M&A. And if we believe that we can make the right deal, we want to stay very actively engaged in both the process but then also being able to close out acquisitions that will allow us to continue to drive competitive advantage, provide more products and services to our customers. So it’s really coming back down to the economics behind each of those choices. Clearly, we feel that the stock is undervalued so we’re going to take the proceeds from the Integrated Supply divestiture, apply that to buying back shares.
That also helps us partially offset the dilution of the profit that’s coming out from an EPS perspective. We have been very active with our capital structure. So in the first quarter, we made some additional moves to basically go ahead and issue the bonds to retire the $1.5 billion of notes that we have coming due in 2025. We avoided the breakage cost on that by warehousing those funds against our current facility. So those are the types of ways that we’ve been thinking about this. We want to make sure that we stay balanced between additional share repurchases, delevering, but then making sure that we have enough dry powder for M&A.
Ken Newman: That’s really helpful color, I appreciate that. Maybe just for my last 1 here. John, it was really great color on the data center commentary earlier. But I just wanted to see if you could help us size that opportunity or how you think about sizing that opportunity going forward. I think in the CSS business, data centers maybe around 8% to 10% of sales on a total sales perspective. But just any help on sizing that opportunity on the power and white space buckets you mentioned earlier?
John Engel: Yes. It’s — we’ve not been public on that yet, Ken so let me just say and it’s also a moving target because what happens is now I think there’s not any new data centers that are being designed that are not designed to expressly take advantage or be able to operationalize gen AI applications. So the fundamental design requirements of data centers have markedly changed. I don’t know if you’ll see this in writing much, but markedly changed over the last six to 12 months, which actually the power consumption goes up dramatically, and that drives the need for more complex power solutions, that’s our UBS business; more challenging electrical solutions, that’s our EES business. And obviously, more — there’s more throughput in addition to the power, which is better for our CSS business.
So I don’t want to size it on this call. We do have plans in our Investor Day this year for all our end market verticals and where we see these exceptional secular growth trends to begin to put some more parameters around that. And I think you can look for, in anticipation too, about drill down in the data centers, the whole value chain and the incredible market-leading role that we play because of our unique portfolio globally to help support our end user customers. So stay tuned for that. That will address your question directly.
Ken Newman: Got it. Thanks for all the color.
Operator: Thank you. And this concludes our question-and-answer session. I would like to turn the conference back over to John Engel for any closing comments.
John Engel: So I think we’ve addressed all your questions. I’d like thank you again for supporting us today. It’s very much appreciated. We look forward to speaking with many of you over the next two months. They’re going to be busy next two months as the year has been so far. We’ve been heavily out on the road and engaging investors. But we’ve got four conferences we’re going to participate in, in the coming months: the Oppenheimer Industrial Growth Conference on May 7; the Wolfe Research Global Transportation and Industrial Conference on May 21; Barclays Leveraged Finance Conference on May 21 as well; and the KeyBanc Industrials and Basic Materials Conference on May 29. So with that — I should say, finally, we expect to announce the second quarter earnings on Thursday, August 1. Thank you very much, and have a good day.
Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.
