As predicted by CRN, US-based distribution giant Arrow is looking to boost its European presence, and will do this through DNS. Previously it was believed that Arrow would buy both UK distributors separately. However, last week it emerged that the US firm will wait until InTechnology has acquired Noxs, before then acquiring the distribution arm of the combined company. However, speculation is rife over reasons for this move.
One source close to the deal told CRN: “I understand the deal is going to be closed in the next 10 days. This is a financial move because it is easier for a European firm to buy another European firm and it is then cheaper for a US company to buy just the one company.”
Other sources told CRN that the move could be because InTechnology was already in negotiations to buy Noxs before Arrow tendered its interest.
Alastair Edwards, senior analyst at Canalys, said: “If InTechnology was already in discussions with Noxs, then this move would make sense. DNS/Arrow is building up its enterprise distribution business across Europe and it would get the storage side with InTechnology and the security coverage with Noxs.”
One distributor who wished to remain anonymous, said: “Arrow wants to get into the security market in Europe. It is cash rich and has piles of money for acquisition. Buying both Noxs and InTechnology’s distribution business in Europe would give it a strong foothold in the UK and Europe.”
Ian Kilpatrick, chairman of Wick Hill Group, a rival security distributor to Noxs, said: “This is an interesting opportunity and/or challenge for Arrow and I look forward to seeing how it plays out.”
Earlier this month, CRN revealed several firms were circling Noxs with a view to acquisition (CRN, 23 October). InTechnology last week put out a statement to the City stating it was in negotiations to sell its distribution business.
Due to confidentially agreements, InTechnology, Arrow and Noxs were unable to comment.
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