Ingram cuts off below-par Unix arm
Ingram Micro has sold its Unix division in the UK because it was not meeting expectations.
Ingram Micro has sold its Unix division in the UK because it was not meeting expectations.
The unit, which supplied Hewlett-Packard (HP) 9000 and IBM RS/6000 and AS/400 mid-range servers, has been sold to German distributor Magirus for an undisclosed sum, along with Ingram's Unix operations in Belgium and Italy. Ingram has retained its Unix divisions in France, Denmark, Sweden and Spain.
Meinie Oldersma, managing director at Ingram Micro UK, said the distributor had been unable to justify investment in the unit after HP dropped Ingram as a supplier of its 9000 servers last November.
Ingram's problems were compounded by IBM's move to supply more users and resellers directly; its failure to provide small resellers with business development instead of just selling them kit; a decline in Unix sales; and the intense margin pressure in the mid-range server space.
Resellers will experience little upheaval because Magirus has retained Ingram's entire Unix team and has leased offices from Ingram. Magirus is also giving resellers the same credit terms and limit as they had received from Ingram, Oldersma added.
Joel Pitt, an analyst at investment bank Credit Suisse, said the sale made sense. "Ingram didn't have a big slice of that market. I don't know how much it invested in it, but it wasn't getting a lot in there."
However, Bob Bennett, enterprise solutions group general manager at Ingram Micro, insisted the distributor was committed to Unix in the US.
He insisted that Ingram had no plans to sell its enterprise solutions group, and claimed the unit was one of Ingram's fastest-growing operations in the US.
"You have to realise market conditions in Europe are so different from those in the US," said Bennett. Ingram is not a big player at all in Europe. The company's volumes in Unix were small.
"There are a lot of players in the server market and Ingram did not have a lot of focus."
The enterprise solutions group generated turnover of just under $1bn (£653.4m) in 1999 and is expected to achieve turnover of between $1.4bn and $1.5bn this year.