Distributor Tech Data has agreed to sell its outstanding shares to Apollo Global Management for $130 per share, totaling approximately US$5.4 billion in an all-cash deal.
As a result, Tech Data will turn into a private company.
Based in Florida, Tech Data’s key customers include HP, Apple, and Microsoft among others. It currently has a market cap of US$4.68 billion.
The deal was leaked last month in a Reuters report in which it speculated that Apollo was planning on buying out Tech Data and make it private. Tech Data’s stock price subsequently soared as a result.
A press release on the announcement says that the purchase price represents a 24.5 per cent premium to the unaffected 30-day volume-weighted average closing share price of Tech Data’s common stock ending Oct. 15, 2019, the last trading day prior to the Reuters report.
Apollo Global Management is a capital management company. It operates globally, with credit management being its biggest business segment. As of June 30, 2019, it’s managing approximately US$201 billion for its investors.
After today’s announcement, Tech Data’s stock price jumped by US$6.00 from its $125.41 previous closing price, peaking out at US$131.70 and setting a new 52 week high.