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Synnex is a good place for Supercom to go

I was out of town on a family vacation when the news broke of Synnex Canada acquiring Supercom, a PC distributor in Markham, Ont.

This is truly a bitter-sweet story in my opinion. I’m sure Supercom staff and leadership wanted to remain independent, but that was increasingly not in the cards for them.

My reaction to this deal was one of surprise only because it looked like a transaction Jim Estill usually made. Estill was fantastic at finding value in companies that the market deemed no longer relevant. Estill had a knack for pulling a rabbit out of the hat when acquiring companies. He did it time after time. But this deal did not have Estill’s fingerprints it had Kevin Murai’s and Mitchell Martin’s.

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I think when all is said and done this will turn into a very good deal for Synnex long term. I think Supercom’s culture and offerings fit better with Synnex than it would have with any other distributor, in my opinion.

I also think it was quite shrewd to retain Supercom founder and President Frank Luk in a counselor’s type role. Luk has a wealth of experience and has conducted literally thousands of deals over his career and has a reputation that is second to none in this industry.

I like this deal long term because if you take a look at the numbers and the potential it has to enrich Synnex down the road. Luk once told me that when you make a large acquisition one plus one almost never equals two in business. You are lucky, he added, if you get to one and half and its considered a good deal if stay at one.

So if Supercom can generate $440 million on its own or with some help from the Synnex team this deal would be classified a remarkable success. But even in a worst case scenario of lets say $100 million in revenue that deal still turns into a success because of the small acquisition price of just $36.5 million.

It should be interesting to see how Martin and the Synnex Canada team integrate the assets and employees of Supercom throughout the year.

As for Luk and the entire team at Supercom they should be very proud of themselves for sustaining a business for close to a quarter century in a tough, unforgiving environment of distribution.

One quick hit before I go. Do you want to win an award and get your company recognized? Well then you should attend an IAMCP Canada workshop on March 19 to teach Microsoft partners and other solution providers on how to write their award entry once and submit it three times for the CDN Channel Elite Awards, the Worldwide Partner Conference Awards and the Microsoft Canada Impact Awards.

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Jim Love, Chief Content Officer, IT World Canada

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Paolo Del Nibletto
Paolo Del Nibletto
Former editor of Computer Dealer News, covering Canada's IT channel community.

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