The identity of Westcon-Comstor's $800m (£615m) suitor was kept under wraps by its parent company Datatec in its annual results this morning.
For its year ending 28 February 2017, Datatec suffered a decline in both sales and profits as efforts to modernise distribution arm Westcon-Comstor took a toll on its numbers. Integrator arm Logicalis' performance was "satisfactory".
In April, Datatec revealed it was in talks regarding a possible sale of a "major share" of Westcon-Comstor for more than $800m.
Although names including Arrow, Synnex and most recently ALSO have all been linked to a possible deal, Datatec remained tight-lipped on the identity of its suitor in today's announcement.
"Negotiations are continuing and the proposed transaction is subject to contract and exclusivity provisions," the Johannesburg and LSE-listed firm said.
"There can be no certainty that the transaction will be completed, nor as to the precise terms on which the transaction might be completed."
A five-year modernisation push at Westcon-Comstor - which includes a global SAP ERP roll out and BPO project - is nearing completion, Datatec said.
However, these two projects have inflicted short-term pain on the distributor, with full-year sales sliding 6.9 per cent to $4.5bn and EBITDA tumbling by $35m to $53.5m.
The contribution of Datatec's integrator arm, Logicalis, could not prevent Datatec's group revenues falling by 5.9 per cent to $6.08bn and EBITA by over $40m to $118.9m.
There were, however, some bright spots, even for Westcon-Comstor. This includes "strong growth" in its security segment, where it counts Juniper, Check Point and F5 among its key vendors.
Security accounted for 39 per cent of Westcon-Comstor's revenues in FY17, up from 34 per cent a year before. Networking (mainly Cisco) also rose, from 23 to 25 per cent of sales.
The damage was done in Westcon's unified communications business, where its main vendors are Avaya and Polycom. UC accounted for 21 per cent of sales last year, compared with 26 per cent a year previously. Datacentre also saw its share of revenues drop back, from 17 to 15 per cent.
Logicalis, meanwhile, recorded flat sales of $1.5bn, although the integrator did see services sales swell by 9.3 per cent with "strong growth in both professional and annuity revenue".
Europe fell from 34 to 31 per cent of Logicalis' revenues year on year, with the UK results "affected by the continuing restructuring of the UK operation".
Despite admitting that 2017 had been a poor year, Datatec claimed that the "strategic value of the group's businesses has been maintained".
"The year ended with a very challenging set of circumstances as Westcon Comstor's SAP and BPO implementation negatively impacted the results of the EMEA region," said Datatec chief executive Jens Montanana.
"Logicalis' performance was satisfactory with a continuing trend towards a higher-margin services business.
"The strategic value of our businesses is affirmed by the unsolicited approach for a major share of Westcon-Comstor's operations."
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