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Synnex Downplays Layoff Risks Amid Tech Data Merger

The Synnex-Tech Data merger will seek to deliver $200 million in annual cost savings, but an FAQ document from Synnex executive management to employees downplays the risk of potential layoffs. Instead, the cost savings will mostly involve ERP (enterprise resource planning) and e-commerce synergies, the FAQ indicates.

In an area of the FAQ asking if Synnex positions will be impacted, the written Synnex confirms “some duplication” of talent but doesn’t address if or how the duplication will be addressed. Instead, the bigger emphasis is on cost savings through software automation.

The Synnex FAQ states word-for-word:

  • Q: Will positions be impacted?
  • A: As we bring the organizations together, there will be some duplication. We are focused on growing the combined company and that will allow for additional opportunities for associates. The synergy benefits from this transaction are primarily around using our ERP system and joined eCommerce Systems like Cloud, eliminating duplicative corporate contracts and related activities, and leveraging our BPO organization. As a reminder, we do not have a history of impacting a significant number of positions due to our M&A transactions.

That FAQ document also included a vague response about the future of U.S. office locations, including…

  • Q: Will we be closing facilities/locations?
  • A: As we bring the two Americas operations together, there may be some duplication. However, our focus is on growing the combined businesses.
  • Q: Where will our head offices be located?
  • A: final decision will not be made until closer to the close of the transaction, however given the significance of Greenville and Clearwater to the combined businesses, we expect we will be under a dual headquarters scenario.

The FAQ surfaced in a SEC filing from Synnex.

 

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