Avnet to Sell Technology Solutions Business Unit to Tech Data for $2.6 Billion

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Avnet, Inc., a  global technology distributor, announced Monday that it has entered into an agreement to sell its Technology Solutions operating group to Tech Data Corporation in a stock and cash transaction valued at approximately $2.6 billion.

Under the terms of the agreement, Avnet will receive $2.4 billion in cash and 2.8 million shares of Tech Data common stock, currently valued at approximately $200 million.

Avnet’s Technology Solutions operating group is a global IT solutions distributor serving customers and suppliers in more than 80 countries. It provides next generation solutions, marketing, training, resources and services that span the cloud to the data center and encompass the entire IT lifecycle.

To Partner on IoT Solutions

Additionally, Avnet and Tech Data intend to partner on delivering world class IOT end-to-end solutions to the market.

Upon completion of the transaction, Avnet expects to realize a gain of $3.75 to $4.75 per share. The closing of the transaction, which is subject to customary regulatory approvals, is anticipated to occur in the first or second quarter of calendar 2017.

“Moving forward, Avnet will focus its resources and investments on becoming a leader in design chain and supply chain services not only for our current customers and suppliers, but also for new markets. We will drive targeted investments in embedded solutions, Internet of Things (IOT) and critical digital platforms,” said William Amelio, CEO of Avnet in a prepared statement.

“ By investing in these high growth areas, we can expand the breadth of our portfolio and attract new customers worldwide who depend on us to deliver world-class solutions,” he added.