Tech Data expands further into UK distribution with $350m deal

Acquires SDG Distribution companies in UK as well as France and the Netherlands
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Tech Data has made further inroads into the UK and European markets by agreeing to acquire several firms from Specialist Distribution Group (SDG), the distribution arm of Specialist Computer Holdings (SCH).

Tech Data is set to take on SDG, IQ Sys and ISI Distribution in the UK; ETC and Best'Ware in France and ETC in the Netherlands.

The transactions are expected to be complete by the fourth quarter of fiscal 2013.

Tech Data already trades as Computer 2000 in the UK and this move will cement its position in the sector as a leading business. 

“This transaction demonstrates Tech Data’s strong commitment to our diversification strategy and further expands our enterprise offerings in Europe,” said Robert M. Dutkowsky, chief executive officer, Tech Data Corporation.

“It adds both breadth and depth to our product and customer portfolios, and creates a comprehensive enterprise solution stack in Networking & Communications, Server & Storage and Enterprise Software across a broader pan-European footprint. Our solid balance sheet and strong infrastructure enable Tech Data to make strategic investments such as this that broaden our services and solutions for customers, strengthen our relationship with key vendors and improve overall profitability and returns for our shareholders.”

Sir Peter Rigby, SCH chairman said, "SCH has built two significant international and independent businesses - SDG as an international enterprise distributor and SCC as an international technology solutions and service provider. Each has achieved its best ever financial performance in its last fiscal year against a background of tough economic conditions.

"We have seen the consolidation of distribution businesses worldwide in the course of the last few years and consider that now is the optimum time to pass SDG into the hands of a global player.

"We believe that Tech Data will fulfill the aspirations of our distribution business and of our personnel and are pleased to have selected Tech Data as the acquirer. This decision now allows us to focus entirely upon SCC to take its excellent track record to date yet further in terms of scale, capability and coverage."

Earlier this year, Tech Data took on Brightstar Corp's holding in joint venture Brightstar Europe, which distributes mobile devices, for $165.6 million.

Only yesterday, distributor Interactive Ideas revealed it is moving out of the retail product sector, and focusing on enterprise. It seems it's a time of reflection and consolidation for the channel.

We'll leave you with a few words from Dave Stevinson, sales director from distributor VIP. He commented: “It is further evidence of industry consolidation. This certainly makes Techdata the undisputed giant in IT distribution. The much quoted expression “get big, get niche or get out “ has been perfectly executed by both companies in this case. SCH has chosen to get out and TD have chosen to get big(ger).“

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