Ingram Micro has bought Tech Pacific in a deal estimated at $700 million. The announcement will see Ingram significantly strengthen its IT distribution arm in Asia-Pacific, a move which had been highlighted as a company priority. The deal is expected to be finalised by the end of the year.
The news follows ongoing speculation that Tech Pacific would issue an initial public offering (IPO) on the Australian Stock Exchange if it was unable to negotiate a trade sale. CVC had owned a 58.5 per cent share in Tech Pacific and Hagemeyer a further 31.5 per cent. The remaining 10 per cent was split between senior management.
Tech Pacific employs approximately 1800 people across 15 sites in Australia, New Zealand, India, Hong Kong, Malaysia, Singapore and Thailand. Australia accounted for almost half of the $3.1 billion generated in revenues by the company during the last financial year.
"As the only global IT distributor with operations in Asia-Pacific, we have long recognised the growth opportunities of the region," Ingram Micro chairman and CEO, Kent Foster, said in a statement. "This acquisition provides a giant leap forward in our regional development.
"Tech Pacific is a strong, profitable player in some of the regions key markets ... Sales have outperformed overall market, and every country-based business unit generated an operating profit last year."
Tech Pacific CEO, Shailendra Gupta, and CFO, Guy Freeland, will be retained. Ingram Micro Asia president, Alain Monie, will continue to lead the region.
More news will follow on what the deal means for both local operations and the Australian IT distribution industry as a whole.