The balance of power among the big distribution players shifted last worldwide top slot. week as Tech Data's deal to buy Computer 2000 raised the gauntlet to Ingram Micro.
As predicted in PC Dealer (8 April), talks between Tech Data and Munich-based conglomerate Viag - Computer 2000's parent company - first became public, despite the fact that both companies are understood to have had on/off talks for the past five years to sort out an alliance.
Tech Data - which is a major force in the US, but has a small presence in France and Germany - will pay $395 million in stock to obtain an 80 per cent holding in C2000. The transaction is expected to be completed by 30 June.
The deal will create a distribution organisation that will have a combined turnover in the region of $11 billion, bringing it in line with Ingram's worldwide turnover of $16.6 billion.
Observers and analysts commented that Tech Data and C2000 will be able to offer better prices than rivals, as the company will be buying in larger stock quantities.
One source commented: 'We will definitely experience a price war in the UK.'
Steve Raymund, Tech Data CEO, said: 'We certainly would like to leverage our larger size into greater purchasing power on a worldwide basis.'
Questions have been raised about the future of Ameriquest - C2000's US arm - as well as Tech Data's operations in France and Germany - which are now dwarfed by C2000's own subsidiaries. Raymund admitted it would 'merge the French or at least manage them out of one entity', but was unable to confirm whether the operations would be sold off.
Raymund conceded: 'I wish we could have done this deal earlier, but better late than never.
'Various factors complicated an earlier agreement, including its Ameriquest troubles and our lower stock price.'
Raymund will relocate to Paris for a year during the summer.
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