LONDON --- Avnet, Inc. has bought, for £41 million (about $80 million), the IT Solutions division of British distributor Acal plc. Acal said it would now focus on its two other divisions, electronics and parts services, and that some of the proceeds would be used to seek strategic acquisitions to expand these groups.
Initially, the money would be used to reduce the group's debt. Following the disposal, for reporting purposes, Vertec, Acal'ís medical instrumentation business, will be included within the Electronics division.
With the acquisition, Avnet gains an additional 2000 Acal resellers and system integrators as well as 180 employees experienced in the design and installation of storage networking and document management functions. The division had sales of approximately $200 million in Acal's last financial year ended 31 March 2007.
Acal IT Solutions will be integrated into Avnet Technology Solutions' EMEA business.
The business being acquired has operations in the U.K., the Netherlands, Belgium, Germany, France and Sweden. The closing of the transaction is subject to approval by Acal shareholders and EU merger control clearance.
Dick Borsboom, president of Avnet Technology Solutions EMEA, said in a statement Thursday (Sept. 27) "The acquisition of Acal's IT Solutions business will significantly expand our product line by adding complementary products in high growth segments including Storage Area Networking (SAN), wired and wireless networking and security, and document management.
"In addition, Acal IT Solutions brings a suite of professional services that will enhance our ability to deliver solutions and services that meet the increasingly complex requirements of the combined customer base. We are excited about the opportunities this transaction will provide to deepen our engagement with our reseller partners and accelerate the growth of Technology Solutions in Europe."
The transaction also provides Avnet Technology Solutions EMEA with access to a new market segment through the Headway Technology Group, which specializes in the design and installation of document imaging solutions.
Richard Moon, Chairman of Acal commented: "Following a strategic review last year the Board of Acal plc has concluded that the development of its IT Solutions Business would be best served as a part of a larger organization with an international reach. Avnet provides an exciting opportunity for the staff and stakeholders of this growing business to maximize its opportunities for the future."
Acal has been expanding its electronics distribution business over the past few years, with a greater emphasis on higher technology products, and in particular, the introduction of a number of new specialized semiconductor suppliers.
The Parts Services business concentrates on the supply and management of parts for IT infrastructure maintenance and service companies