Phoenix, Ariz. Avnet, Inc. has acquired YEL Electronics Hong Kong Ltd., a leading distributor of interconnect, passive, electromechanical (IP&E) and limited semiconductor components in the Asia region. Avnet is not disclosing the purchase price of the acquisition.
With the acquisition, Avnet increases its IP&E business in Asia by more than 50%, up from 10% prior to the acquisition. The global distributor also gains 12 new suppliers.
YEL generated approximately $200 million of revenue in the twelve months ended December 2007 with over 80 percent of its revenue coming from IP&E products. The Asian distributor claims more than 2000 customers in eight countries across Asia Pacific. YEL represents over 30 franchised suppliers.
"The IP&E distribution industry in Asia is highly fragmented and Avnet intends to actively participate in its consolidation. The acquisition of YEL provides an excellent opportunity to supplement our organic growth initiatives by adding a well respected regional distributor with a management team that shares our focus on profitable growth and superior customer service. With this acquisition, we have increased our IP&E business in Asia by over 50% and become the largest IP&E distributor in the region," said Harley Feldberg, president of Avnet Electronics Marketing global, in a statement.
Avnet YEL will operate as a specialist division and will continue to focus on IP&E growth. The transaction is expected to be immediately accretive to earnings, excluding minimal integration charges, and supports Avnet's long-term return on capital goals.
In addition to distributing semiconductor and IP&E products, Electronics Marketing Asia also offers a wide portfolio of value-added services that include design, demand creation, technical support as well as supply chain and logistic services.