Why is Tech Data Corp. acquiring Avnet Technology Solutions for $2.6 billion from Avnet? Tech Data CEO Bob Dutkowsky explained the deal to ChannelE2E moments ago.
The quick-hit interview...
ChannelE2E: What does Tech Data gain from this deal?
Dutkowsky: "It gives us so much. We want to build on our vision as a truly end-to-end player. To do that, you have to bring technology from the desktop to the data center and all the way to the cloud. You need to secure all of that. And you need to interconnect with the Internet of Things. Plus, you've got to deliver data analytics and the right services to the channel. We've been building that out over the past decade or so. As we looked toward the future, we wanted to build that out even more."
The net result, he says: Historically known as a "broadliner" distributor, Tech Data's value-added business has also gotten to be very large in recent years, he adds. The ATS acquisition further empowers Tech Data with deeper vendor relationships in the data center. "ATS completes the puzzle for us," he says. Once the deal closes, Tech Data will scale to $35 billion in sales from $26 billion in sales -- while pushing into additional markets like Asia.
ChannelE2E: How long have Tech Data and Avnet been discussing the potential ATS deal?
Dutkowsky: "It's been in the works for almost a year." Dutkowsky and the Tech Data team sounded relieved that rumors about the negotiations and resulting deal never leaked into the press ahead of this morning's official announcement.
The deal, pending regulatory approval, is expected to close in the first half of 2017. In the meantime, Dutkowsky says, "it's business as usual" at Tech Data.
For ChannelE2E's complete coverage of mergers and acquisitions involving VARs, MSPs, CSPs and channel vendors, visit ChannelE2E Milestones.