Tech Data, a distributor of IT products, announced it has entered into an agreement to acquire the stock of Triade Holding, a privately held portfolio of value-added distributors of consumer electronics, mobility and IT products in Benelux and Denmark.
In a related transaction, Brightstar Europe, a joint venture between Brightstar and Tech Data, has announced an agreement to acquire Triade company Mobile Communication Company, a mobility specialist in Benelux. The transactions are subject to approval of European Union regulatory authorities and are expected to be completed during the third quarter of fiscal 2011, according to a Tech Data release.
The acquisition of Triade Holding expands Tech Data's product, vendor and customer portfolios throughout the Benelux region and Denmark, leverages the company's pan-European infrastructure and adds approximately 450 skilled employees. The transaction is expected to be immediately accretive to fiscal year 2011 earnings, excluding acquisition and integration costs.
For the 12 months ended Jan. 31, Triade generated sales of approximately $1.2 billion, broken down by product group as follows: Approximately 35 percent consumer electronics, 39 percent mobility and 26 percent IT. The transaction's total enterprise value, including assumed debt, is estimated at approximately $189 million, of which approximately 45 percent relates to MCC, to be acquired directly by Brightstar Europe.
Upon completion of the acquisition, results for MCC will not be consolidated in Tech Data's financial statements. Instead, Tech Data will account for 50 percent of MCC net income through an "income from joint venture" line item below operating income.
"This major transaction validates our diversification strategy, moving Tech Data into high growth, specialty product categories, and will contribute to achieving our stated financial goals," said Robert M. Dutkowsky, CEO of Tech Data. "The addition of Triade's portfolio of companies complements and strengthens our existing European broadline business, accelerates our entry into Europe's consumer electronics market, and expands our Brightstar Europe joint venture's mobility footprint, all of which provide a compelling platform for growth."