Bell keeps eye on acquisition

Distributor hopes to return to profitability by next quarter

Bell Microproducts hopes to return to profitability by next quarter and is keeping an eye open for a UK acquisition.

The global distributor and parent company of UK distributor Ideal blamed a steep decline in growth and too many overheads for its recent string of losses, according to Don Bell, chief executive of Bell.

But the company is confident that its continuing investments during the recession and its work to consolidate acquisitions will bear fruit in the near future.

Speaking to vnunet.com's sister title CRN, Bell said: "We were geared up to growing at 70 to 80 per cent. We went from being a $250m company to being a $2bn company.

"[Then] growth fell to around five to 10 per cent during the recession. We had too many overheads."

Bell also said some of the eight companies it bought in the past three years were losing money, and all but one is now back in the black.

"I could cut expenses to make Bell instantly profitable, but we would have to give up some of things we have invested pretty hard in," he said.

Bell said the trend of consolidation would also continue. He said the company would make an announcement soon regarding acquisitions in Latin America and is also keeping watch on a suitable company in Europe.

"We are looking at Europe and the UK, but it would have to be something compatible that fits into our enterprise storage solutions business. There are some good companies available. We'll continue to keep an eye open."

Nitin Joshi, partner at accountancy and insolvency specialist PKF, said: "There are tremendous acquisition opportunities, especially for anyone with pan-European aspirations. Great care needs to be taken.

"Control is key, as is having the right management team. Focus needs to be on economies in the back office."

One reseller, who asked to remain anonymous, added: "If Bell does make acquisitions it should be in the software space, because it has good momentum there. Either that or sell off the software division and reinvest the money."