Monday Morning Impact – June 12

Synnex to Acquire Westcon-Comstor’s North America and Latin America Businesses

Synnex has announced that it has reached agreement to acquire Datatec’s Westcon-Comstor Americas business. Terms include $500M in stock and $100M in cash at closing, and 10% ownership of Datatec’s Westcon EMEA and APAC businesses.

“We believe this is a unique opportunity that is transformational to Synnex and is aligned to our strategy of positioning the business to where technology is growing,” said Synnex president and CEO Kevin Murai.  “Westcon-Comstor is a recognized leader in the security, UCC and networking space.”

For its fiscal year end ended February 28, 2017, the Westcon Americas business generated approximately $2.2 billion of revenue and approximately $89 million in EBITDA. In the first 12 months after close, the Westcon Americas business, excluding integration costs, transaction expenses and intangible amortization, is expected to be mildly accretive to Synnex non-GAAP EPS and then accelerate in year two.

“The Synnex culture is similar to Westcon-Comstor and I’m excited about the opportunity to grow our businesses together on a global scale,” said Jens Montanana, CEO of Datatec. “We share a common vision and strategic objective in addressing the global complexities and emerging demands facing our partners.”

The transaction is expected to close in the third calendar quarter of 2017, subject to the satisfaction of regulatory requirements and customary closing conditions.

Channel Impact^®
The move strengthens the Synnex position in targeted market and also is believed to strengthen its Cisco alliance through existing Westcon partnerships.

HP and Infosys Partner to Accelerate Digital Transformation for the Enterprise

Infosys and HP Inc. have launched joint Retail Point of Sale (RPOS) and Enterprise Device as a Service (DaaS) solutions to help businesses accelerate digital transformation as part of the HP Global System Integrator (GSI) Alliance Program.

The initiative is designed to enable real-time collaboration between shoppers, retailers and vendors at the point of purchase, providing a true omni-channel experience. The joint solution defines and delivers technology-enabled transformations that optimize how organizations acquire, manage and use devices with end-to-end services, enterprise applications, fleet reporting, analytics, insights, etc.

“The launch of the RPOS and Enterprise DaaS solutions validates our joint vision with HP for revolutionizing the retail industry through constant innovation, and deep analytics,” said Sandeep Dadlani, president of Americas at Infosys. “Digital transformation is being steadily embraced by businesses and as this transformation evolves further, we will continue our focus to create newer experiences across industry segments.”

The HP Global System Integrator (GSI) Alliance Program is designed to help HP and select leading Global System Integrators to co-develop solutions available in a choice of consumption models, mirroring the migration from purely transactional to everything-as-a-service. From a marketing perspective, the program reinforces HP as vendor of choice for the tools of digital transformation and provides customers with technology guidance.

Channel Impact^®
As technology becomes increasingly pervasive throughout the buying cycle, vendors and their channel partners will continue to work in an increasingly collaborative fashion in order to meet the needs of the end customers they share.

Rackspace to Acquire TriCore Solutions

Rackspace announced that it signed an agreement to acquire TriCore Solutions, a leader in the management of enterprise applications, including Enterprise Resource Planning (ERP) solutions from Oracle and SAP. This acquisition is expected to close in June, and will likely bolster the San Antonio, Texas-based company’s position in key verticals including manufacturing, logistics, procurement, supply chain management, customer service, HR and financial operations.

“Our customers are asking us to move further ‘up the stack’ by expanding our managed application capabilities,” said Jeff Cotten, president and interim CEO of Rackspace. “TriCore’s services are among the best in that space and are highly complementary to ours. They will help enable us to deliver more of the services that our existing customers need, while opening the door to new opportunities across the globe.”

TriCore provides a full suite of scalable managed application, cloud and infrastructure hosting, and consulting services for approximately 275 enterprise organizations. The company is headquartered in Norwell, MA, with offices in India and throughout North America.

Terms of the transaction were undisclosed.

Channel Impact^®
This move is likely to strengthen the Rackspace position in several targeted verticals, and underscores the need for culture similarities in navigating successful acquisitions.