MiTAC Holdings Corp (神達控股) yesterday announced a US$7.2 billion merger between its investment company, Synnex Corp, and information technology distributor Tech Data, which would create a world-leading information technology (IT) distributor if approved.
Synnex and Tech Data, both based in the US, have entered into a definitive merger agreement, under which the two companies would combine in a transaction valued at about US$7.2 billion, including net debt, Taoyuan-based MiTAC said.
“The combined company, with about US$57 billion in estimated pro forma annual revenue, and a team of over 22,000 associates and colleagues, will provide customers and vendors with expansive reach across products, services and geographies to accelerate technology adoption,” MiTAC said in a statement on its Web site.
Photo: Vanessa Cho, Taipei Times
If the deal closes, Synnex shareholders would own about 55 percent of the combined entity, with Apollo Global Management Inc, which bought Tech Data in June last year, owning about 45 percent, the statement said.
The transaction is expected to be completed in the second half of this year, subject to the satisfaction of customary closing conditions, including approval by Synnex stockholders and regulatory approval, it said.
Synnex president and chief executive officer Dennis Polk said the company is excited to partner with a world-class industry leader such as Tech Data and believes that the move would benefit all stakeholders.
“This transaction allows for accelerated revenue and earnings growth, an expanded global footprint and the ability to drive significant operating improvements, while continuing to create shareholder value,” Polk said.
Through the merger, Synnex and Tech Data are expected to create the world’s largest IT distributor, which could generate US$100 million of optimization and synergy benefits in the first year after the closing, and about US$200 million by the end of the second year, media reports have said.
“The combined company will have a global footprint that serves more than 100 countries across the Americas, Europe and the Asia-Pacific region, and a broad, diversified portfolio of more than 200,000 product and solutions offerings,” Synnex said.
“This meaningful scale will provide increased value and purchasing efficiencies to the combined company’s 150,000 customers and more than 1,500 vendors, and enable it to accelerate technology adoption and attract the world’s most innovative OEMs [original equipment manufacturers],” said the US firm, which provides business-to-business IT services.
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