The acquisition of Bell Micro was approved by its shareholders, which represented more than 98 per cent of the total votes cast and also received all regulatory approvals.
The deal ended up being worth $252 million, giving the transaction a value of about $631 million, assuming net debt position for Bell Micro of $379 million at face value as of March 31, 2010.
Bell Micro is Avnet’s (Nasdaq: AVT)largest historical acquisition based on revenue, but more important is what happens now especially in the Canadian market. I understand that this deal was all about increasing shareholder value and company chairman and CEO Roy Vallee I believe has done that. The timing was simply impeccable on his part.
But that aside there are some big questions to be answered such as what happens to Peter Diniz, the long time president of Bell Micro in Canada? How will Avnet integrate Bell Micro staff? How will they go to market in their new form? What’s the plan with the reseller asset Avnet got with this deal?
Vallee spent a lot of time this week talking about how Avnet strengthened its position in Latin America with the Tallard Technologies acquisition. That’s great for those who live in Brazil and don’t get me wrong I see the growth potential in Latin America. But Avnet and Bell Micro have significant operations right here in Canada that need to be addressed.
I think it would be disappointing to see Avnet Canada just boost its hard drive business and nothing else. The market is clamoring for more solutions-based distributing. Avnet took a good step towards this with its Cloud Ready offering a few months ago. Bell Micro was growing its data centre business up until it was acquired. The reseller partners are struggling to figure this out right now. Other distributors are positioning themselves in the data centre area. Now is the time for Avnet, with the Bell Micro assets in hand, to launch a plan for the data centre.
Promotion coming to an end at Synnex Canada
You only have a week left before the excellent HP Smart Buy promotion ends at Synnex Canada. The promotion started in April and if channel partners bought any HP Smart Buy products with options or services at Synnex they would earn one per cent in Synnex rewards.
Synnex was quite proactive with this promotion as they created HP Cheat Sheets to help resellers ensure best return quotes.
HP even developed the Fast Attach Tool that helped partners figure out which products went with what services. It’s not too late to pick up some extra margins. Just go to www.synnex.ca/forms/rewards/registration_form.cfm for more details.
