Company will accelerate strategy to bring world-class design chain and
supply chain services to high-growth customer markets
Inc. (NYSE: AVT),
a leading global technology distributor, today announced that it has
entered into an agreement to sell its Technology Solutions operating
group to Tech Data Corporation in a stock and cash transaction valued at
approximately $2.6 billion. Under the terms of the agreement, Avnet will
receive $2.4 billion in cash and 2.8 million shares of Tech Data common
stock, currently valued at approximately $200 million.
The sale of this business provides both Avnet and Tech Data with
immediate opportunities to focus on core strategies and scale their
respective businesses, ultimately delivering greater profitability to
"We believe the acquisition of Technology Solutions by Tech Data is the
best decision for our employees, customers, suppliers and shareholders.
This transaction presents us with the best strategic path for Avnet's
future success and profitability, and puts Technology Solutions in
position to achieve breakthrough business results with Tech Data," said
William Amelio, chief executive officer of Avnet. "Moving forward, Avnet
will focus its resources and investments on becoming a leader in design
chain and supply chain services not only for our current customers and
suppliers, but also for new markets. We will drive targeted investments
in embedded solutions, Internet of Things (IOT) and critical digital
platforms. By investing in these high growth areas, we can expand the
breadth of our portfolio and attract new customers worldwide who depend
on us to deliver world-class solutions."
Avnet's Technology Solutions operating group is a global IT solutions
distributor serving customers and suppliers in more than 80 countries.
It provides next generation solutions, marketing, training, resources
and services that span the cloud to the data center and encompass the
entire IT lifecycle. They work with value-added resellers to make it
easier and more affordable to enter and excel in high-growth technology
and vertical markets locally and around the world.
"This transformative transaction will position us as a premier global IT
distributor with the most diverse end-to-end solutions from the data
center to the living room," said Bob Dutkowsky, chief executive officer
of Tech Data. "Tech Data has competed with and admired Avnet Technology
Solutions for many years. We're thrilled to start this journey together
and are confident that our customers, vendor partners, employees, and
shareholders will appreciate and benefit from the value that we will
bring to the market. We look forward to welcoming the Technology
Solutions team to Tech Data and are excited for the opportunities that
this combination creates."
Additionally, Avnet and Tech Data intend to partner on delivering world
class IOT end-to-end solutions to the market.
Upon completion of the transaction, Avnet expects to realize a gain of
$3.75 to $4.75 per share. The closing of the transaction, which is
subject to customary regulatory approvals, is anticipated to occur in
the first or second quarter of calendar 2017.
Citi and Allen & Company LLC are acting as financial advisors to Avnet,
while Gibson, Dunn & Crutcher LLP, is acting as legal advisor.
Conference Call/Webcast Scheduled
Avnet will host a conference call and webcast today, September 19, 2016
at 11:30 a.m. ET (8:30 a.m. PT). The conference call is available by
dialing (877) 407-8112 or (201) 689-8840 from outside the U.S. A link to
an audio webcast of the conference call will be available at www.ir.avnet.com.
A replay will be available approximately two to three hours after the
call ends until Monday, October 31, 2016 at 5:00 p.m. ET. To access the
replay, please dial (877) 660-6853 or (201) 612-7415, and conference ID
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All brands and trade names are trademarks or registered trademarks,
and are the properties of their respective owners. Avnet disclaims any
proprietary interest in marks other than its own.
This document contains certain "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
statements are based on management's current expectations and are
subject to uncertainty and changes in facts and circumstances. The
forward-looking statements herein include statements addressing future
financial and operating results of Avnet and may include words such as
"will," "anticipate," "intend," "estimate," "forecast," "expect,"
"feel," "believe," "should," and other words and terms of similar
meaning in connection with any discussions of future operating or
financial performance, business prospects or market conditions. Actual
results may differ materially from the expectations contained in the
The following factors, among others, could cause actual results to
differ materially from those described in the forward-looking
statements: closing of the acquisition of Premier Farnell plc, the sale
of the Technology Solutions operating group, the Company's ability to
retain and grow market share and to generate additional cash flow, risks
associated with any acquisition activities and the successful
integration of acquired companies, an industry down-cycle in
semiconductors, IT hardware or software products, declines in sales,
changes in business conditions and the economy in general, changes in
market demand and pricing pressures, any material changes in the
allocation of product or product rebates by suppliers, and other
competitive and/or regulatory factors affecting the businesses of Avnet
More detailed information about these and other factors is set forth in
Avnet's filings with the Securities and Exchange Commission, including
the Company's reports on Form 10-K, Form 10-Q and Form 8-K. Except as
required by law, Avnet is under no obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
About Avnet, Inc.
From components to cloud and from design to disposal, Avnet, Inc. (NYSE:AVT)
accelerates the success of customers who build, sell and use technology
by providing a comprehensive portfolio of innovative products, services
and solutions. Avnet is a global company ranked on the FORTUNE 500 with
revenues of $26.2 billion for the fiscal year 2016. For more
information, visit www.avnet.com.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160919005463/en/
Investor Relations Contact
Maureen O'Leary, 480-643-8075
Source: Avnet, Inc.
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