Ingram Micro to acquire BrightPoint for $840m

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Deal expected to be finalised in Q4 in what the companies say will create a leading global provider of device lifecycle services and solutions for the mobile industry

Technology distributor and supply chain services provider Ingram Micro has acquired logistics services provider BrightPoint for $840 million (£535 million).

Ingram Micro expects to fund the acquisition with existing credit facilities and available cash balances. It has obtained a $300 million debt facility from Morgan Stanley Senior Funding, and expects to achieve annual cost savings in excess of $55 million by 2014. The purchase includes BrightPoint’s $190 million estimated debt as of June 30, 2012.

It requires the approval of a majority of BrightPoint’s outstanding shares at a meeting, scheduled to take place in Q3. It is also subject to regulatory approvals, and is expected to be complete before the end of the year.

BrightPoint regional presidents Mark Howell (Americas), Bruce Thomlinson (APAC) and Anurag Gupta (EMEA), as well as chief financial officer Vincent Donargo, are taking up senior roles within the new organisation.

BrightPoint founder, chairman and CEO Robert Laikin will serve in a senior advisory role to Ingram Micro president and CEO Alain Monié.

The companies said the deal will create a leading global provider of device lifecycle services and solutions for the mobility industry. They added they will have vast customer reach and deep relationships with key vendors, network operators and MVNOs, and will have an expanded global geographic footprint and customer base.

Monié said: “BrightPoint’s offerings are highly complementary to both our logistics and distribution businesses, which will enable us to go to market with the leading portfolio of mobility device lifecycle services and solutions.

“Our expanded geographic footprint and strong financial position create growth opportunities for the combined company and give vendors, network operators and mobile virtual network operators, partners and customers one-stop access to one of the widest ranges of mobility and technology products, services and solutions.

“Strategically, it is a great fit and is immediately additive to Ingram Micro’s existing offerings. Expanding our presence in the mobility market has been a focus of Ingram Micro and the acquisition of BrightPoint accomplishes this to an extent that would have been challenging to achieve on our own.

“Additionally, the complementary nature of our businesses provides a unique opportunity to drive synergies and efficiencies across the combined companies, which is expected to result in meaningful accretion to earnings per share beginning in 2013. The transaction clearly supports our longer-term growth and profitability targets and meets our return-on-investment criteria for creating shareholder value.”

Laikin added: “The transaction with Ingram Micro will deliver significant value to our shareholders and will enable us to accelerate our global growth strategy. This powerful combination will also provide compelling opportunities for BrightPoint’s vendor partners, customers and employees to benefit from the financial strength, scale and broad geographic reach of the world’s largest technology distribution company.

“This is the right time for this transaction. I believe strongly that Ingram Micro is the best partner for our business and employees going forward and I am excited at the prospect of BrightPoint becoming part of a Fortune 100 company.”

BrightPoint was established in 1989 and is headquartered in Indianapolis. In the 2011 financial year, it posted revenues of $5.2 billion and gross margin of 7.2 per cent. It employs some 4,000 people and operates facilities in 24 countries, with sales in more than 75 countries. It serves more than 25,000 B2B customers with over 100,000 points of sale globally. It handled more than 112 million wireless devices last year.

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