Back in May the Channel was shaken by the news that Entatech had gone out of business.
With the company on the ropes for some time, a deal was struck with Beta Distribution for the Telford-based distie to be purchased. The deal looked like it was sure to go ahead, but Beta was scared off after the due dilligence process where it discovered that Entatech’s stock was worth less than previously thought.
And now, speaking with PCR for the first time since Entatech’s bankruptcy, Beta managing director Steve Soper has confirmed that the firm was spooked during the due diligence.
"We reached a commercial deal that worked for both parties pretty early on. We felt it was a good deal for us. If you looked at the kind of partner that Entatech dealt with, Beta was already dealing with a lot of those customers, albeit with different products.
"Unfortunately as we got towards the final hour of the deadline, certain things came out of the due diligence that did not exactly sit well with us… there were a couple of elements that we weren’t comfortable with. We asked for more time, but for reasons that I can only speculate on at this moment in time, KPMG was unwilling to give us an extension to the deadline."
The drama of Entatech’s bankruptcy sent waves through the entire Channel, with many respected industry figures showing their sympathy. One such was PC Clinic Technologies MD Phil Barnfield, who described it as ‘bad news for the industry’ and ‘a sign of the times ahead’.
Read the full interview with Beta Distribution’s managing director Steve Soper in the August issue of PCR, hitting shelves next week.