Story image

Synnex' US$830 million acquisition of Westcon completes

04 Sep 2017

Synnex has completed its acquisition of Westcon-Comstor’s Americas businesses, and  its minority investment in Westcon’s Asia Pacific and EMEA business.

The distributor has taken a 10% stake in Westcon-Comstor’s Asia Pacific and EMEA businesses for US$30 million.

The purchase of Westcon-Comstor’s North American and Latin American businesses set Synnex back up to US$800 million, however, it provides Synnex with access to the Cisco portfolio.

Kevin Murai, Synnex president and chief executive, says “We believe this talented team [Westcon-Comstor Americas]  and their recognised leadership in the security UCC and networking space will enhance our value proposition in the market place.

“The acquisition of Westcon-Comstor Americas continues to build on our strategy of positioning the business to where technology is growing,” Murai adds.

As well as paying $600 million cash upfront for the Americas business and $30 million for the minority share, Westcon-Comstor owner Datatec can earn up to an additional $200 million if certain financial targets are achieved thorugh to February 2018.

The deal sees Synnex assume around $190 million in net debt.

The distributor has put in place a $1.8 billion facility, including a $1.2 billion term loan and a $600 million revolver to fund the acquisition and provide additional working capital requirements.

Datatec shareholders last week voted unanimously for the transaction.

Datatec has said the time isn’t right for the sale of Westcon International, with the company’s financial and operational performance affected in the last financial year by the roll out of the SAP ERP system and business process outsourcing across its Asia Pacific and EMEA businesses.

Datatec’s last financials saw group revenue down 5.8% to US$6.1 billion, with profit falling from $48.2 million to $10.7 million. Westcon-Comstor accounted for 74% of the company’s revenue and was down 6.9%.

Jens Montanana, Datatec chief executive, said at the time of the acquistion announcement that there is potential to enhance growth and consequently the value of Westcon International with Synnex as a minority player.

Bitglass appoints new cloud, business development leaders
The cloud security company has appointed vice presidents for worldwide channels and worldwide business development.
Ping Identity offerings accelerates cloud MFA and SSO adoption
90% of respondents trust MFA as an effective security control to protect identity data in public clouds, yet only 60% of organisations have formally adopted it.
Ingram launches CRM backup on cloud marketplace
AvePoint Cloud Backup for Dynamics 365 is a multi-tenant solution, designed with specific features to enable channel partners and MSPs.
Trend Micro introduces cloud and container workload security offering
Container security capabilities added to Trend Micro Deep Security have elevated protection across the DevOps lifecycle and runtime stack.
Veeam joins the ranks of $1bil-revenue software companies
It’s also marked a milestone of 350,000 customers and outlined how it will begin the next stage of its growth.
Veeam enables secondary storage solutions with technology partner program
Veeam has worked with its strategic technology alliance partners to provide flexible deployment options for customers that have continually led to tighter levels of integration.
Veeam Availability Orchestrator update aims to democratise DR
The ability to automatically test, document and reliably recover entire sites, as well as individual workloads from backups in a completely orchestrated way lowers the total cost of ownership (TCO) of DR.
Nuix eyes legal sector as eDiscovery demand skyrockets
eDiscovery must encompass so much more than email and documents. If you haven’t looked at text messages and online chats, digital images, mobile devices, data in the cloud and social media, you’re not getting the whole story.