Buyout binge continues as CHS splurges on Vobis

Distribution Acquisition adds German retail operation to the mix.

CHS Electronics has snapped up German retail giant Vobis, along with its manufacturing operations Maxdata and Peacock, for $320 million.

The move will strengthen CHS' position as an assembler, making it attractive to vendors with channel assembly programmes.

Peter Rigby, marketing director at CHS, explained the Vobis deal. 'The assembly part of the business was what we were really after - we now have a facility in Germany that was turning out 50,000 units. We really want to get into selling non-branded products. This will allow us to keep the competition at bay and further consolidate our position,' he said.

A statement from parent group Metro AG revealed: 'The decision to dispose of this core activity takes place following an intensive analysis of all strategic options. With increasing concentration in the distributor market for PC products, only globally operating companies will be able to assume market-leading positions in the future.'

Rigby conceded CHS had needed to react to Ingram Micro's use of the Tulip plant in Holland. He added the retail operation was not an attractive part of the deal because its acquisition would result in a huge channel conflict with CHS' channel.

Speculation that Vobis was up for sale by Metro AG had been rife as the European distribution gold rush continued, spearheaded by the US-owned industry giants.

Merger mania in the distribution channel has seen many of the industry's big names coming together. Following its $87.7 million takeover of Metrologie, CHS claimed the title of Europe's largest distributor (PC Dealer, 22 April).

Tech Data bought German distributor Computer 2000, while Ingram Micro has secured the long-term lease of Dutch vendor Tulip Computers' manufacturing facility (PC Dealer, 27 May).

An industry source, who had been observing the consolidation activity in the channel, commented on the retail division: 'CHS is pushing itself as a global player. With regard to the retail outlets, I'm sure it will have lined up a buyer before completing the deal. A company like Dixons could be interested in aspects of it.'