Ingram Micro sold to Chinese conglomerate for $6 billion

This morning there are several reports of the sale of Ingram Micro, the world’s largest distributor to HNA Group of China.

HNA is multinational conglomerate with more than $90 billion in assets in industries such as aviation, financial services, real estate, and shipping.

What channel partners should know right away is that nothing dramatic is going to occur to interrupt the current business flow with Ingram Micro. Initial reports suggest NHA has plans to leave Ingram Micro alone and run them as a subsidiary with headquarters remaining in Irvine, Calif. And, Alain Monie the CEO to stay in charge.

When the deal gets completed there will be some layoffs, but Ingram described the impending staff reduction as “a few.” Also the Ingram Micro name and brand image will remain.

The HNA Group also assured Ingram officials that it does not plan any closures or consolidation of offices, facilities or warehouses. The HNA Group went further to say it does not expect to close or combine offices as a result of this deal nor do they have plans to integrate systems apart from what is currently doing.

Monie issued a long statement confirming the deal saying “we will deliver near-term, compelling value to stockholders while also gaining the opportunity to accelerate the execution of our long-term strategy to deliver best-in-class solutions to our partners across the global IT ecosystem.”

Partners should also take into account that while this deal has been announced its far from being completed and faces several regulatory hurdles such as the U.S. Committee on Foreign Investment who will no doubt look over this deal with a fine-tooth comb. Ingram with its solution provider partners regularly bid for U.S. government contracts and the U.S. Committee on Foreign Investment based in Washington, D.C. works to review national security concerns on all major foreign investments. This committee oversees areas that could impact U.S. defense, commerce and homeland security.

A source at Ingram sent CDN a few details on this deal.

  • We do not anticipate a change in our business strategy as a result of this merger, if anything we will be able to accelerate our investments and execution.
  • HNA Group has assured us it fully supports Ingram Micro’s strategic direction and is dedicated to offering innovative solutions across the IT ecosystem and providing a superior vendor experience.
  • Innovation, new services introduction, brand management and ensuring the stability and continuity of the business operations they acquire are fundamental to HNA Group’s overall strategy.
  • In fact, as a part of HNA Group, Ingram Micro expects to have the ability to accelerate our investments, both organically and through M&A, to enhance and add to our capabilities in high value IT solutions, mobility lifecycle services, commerce and fulfillment solutions and cloud, while also continuing to extend our geographic reach.

The transaction is slated to be completed in the second half of 2016. From there Ingram plans to operate as a subsidiary of Tianjin Tianhai. Tianjin is a large retail company in China that is also a subsidiary of HNA Group.

From a Canadian perspective, Ingram stated that all lines of business from regional and country operations will be unaffected.

HNA’s CEO Adam Tan also issued a statement: “Ingram Micro has clearly established itself as a leading distributor and global provider of IT products and services. The Company has a proven and talented team and we believe Ingram Micro is unrivaled in its ability to offer industry-leading, differentiated and easy-to-manage solutions to vendor and customer partners worldwide. We look forward to supporting Ingram Micro’s management team and strategies, including continued expansion into new geographies, while also offering their vendor and customer partners access to new and complementary offerings. We share Ingram Micro’s commitment to integrity, innovation and performance and we are confident this transaction will enable Ingram Micro to continue to distinguish itself in the marketplace and meet the needs of its vendor and customer partners better than ever before.”

One final piece from Ingram Micro was particularly interesting and it covers the differences about being owned by a Chinese company. Ingram reported: Chinese businesses continue to play a role of ever-increasing importance in the global economy and have been investing in multinational and U.S.-based businesses for a number of years, generally relying on the existing management teams and employees of the companies they acquire.

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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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