Compel has quashed speculation that it is for sale despite appointing a financial adviser in the wake of the fall-out of its shock profits warning.
Neville Davis, chief executive at Compel, said that the reseller was "confident" of its future as an independent business and had no intention of selling out.
Davis said Compel had appointed Close Brothers as a financial adviser because of its reputation in the technology stocks sector and because its advice will be valuable.
"We've been talking about appointing a merchant bank to replace our stockbroker for a long time because we felt that we needed to get their advice about where we are and where we need to go," said Davis. "We are not putting up a For Sale sign outside Compel. We are not planning to sell the business."
He insisted that the Year 2000 hangover was behind Compel's problems, saying it had had no trouble integrating its various acquisitions - including Info'Products - over the past year. Mismanagement was also not a factor, said Davis.
"Look around the market and you will see a raft of people making similar comments to ourselves. [The Year 2000 hangover] is undoubtedly a phenomenon. We've been impacted by the nature of our customer base. Computacenter and Specialist Computer Holdings have a much broader customer focus and both have distribution businesses which service SMEs. This downturn is only applying in the corporate customer base, so therefore we are more impacted," he said.
Davis added that the restructuring which Compel had announced in its profits warning did not involve a withdrawal from certain markets, but a rationalisation of its six businesses into three large units to make it easier to manage. No staff had been laid off or offices closed.
Analysts agreed that Compel had been brought low by Year 2000 problems. Richard Holway said Compel had been in a state of denial about how fast demand would ramp up, and that "reality has intruded rather painfully".
Chris Jones, an analyst at Canalys, said: "It is unlucky that Compel has to deal with mergers, Year 2000 and change in management at the same time, but Year 2000 slowdown and its hangover were most probably the major reason behind the warning."
Meanwhile, ICL's plans to float this year took a battering when it recorded profit before tax on the back of the disposal of several of its businesses. Without the income from the disposals, ICL posted an operating loss of £69.7m on turnover of £2.77bn for the year ended 31 March, compared with a loss of £128.9m on turnover of £2.73bn last year.
However, the company's UK operation was profitable.
First published in Computer Reseller News
Infrastructure provider says international sales now make up 51 per cent of its revenue
Suzanne Chappell of TMS plans sailing venture after selling Oxfordshire-based TMS to acquisitive Chess
Withdrawal of credit insurance by some providers a 'reflection' of current challenge facing IT sector, according to MD Steve Soper
SMART's UK managing director joins Lenovo to boost SMB business