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Ingram Micro ends Chinese adventure with $7.2bn sale

Distributor Ingram Micro has been picked up by US private equity player Platinum Equity, ending four years under the ownership of the HNA Group

Ingram Micro is being acquired from Chinese aviation and shipping conglomerate HNA Group in a $7.2bn deal.

The distributor’s new owners will be US-based Platinum Equity, bringing to an end a four-year spell of Chinese ownership.

There had been indications that a change of ownership was on the cards for a while, with HNA looking to divest itself of some of its foreign investments to refocus on the core business.

The Platinum Equity deal is expected to complete in the first half of 2021, once it gets the nod of HNA shareholders and regulatory approval.

The plan is to keep the current Ingram Micro CEO Alain Monié in place and keep the business based in its Irvine, California headquarters.

“Platinum’s sector expertise, global operating capabilities and financial resources make it the ideal partner,” said Monié.

“Teaming with Platinum provides an opportunity to further strengthen our competitive advantage in the cloud, speed our digital transformation and accelerate the expansion of our solutions and services portfolio, particularly for high-value markets. We will also be able to broaden our geographic reach even faster, while penetrating new industries and verticals,” he added.

Monié said that Ingram Micro would have more financial muscle going forward, but acknowledged that HNA had been a good partner, giving the business a chance to expand its business geographically.

“Ingram Micro is an industry leader, one of the largest companies in the world, and will be a cornerstone investment in our portfolio,” said Platinum Equity chairman and CEO Tom Gores. “We have the resources and the experience to help the company pursue an aggressive agenda of growth and transformation.”

Platinum Equity is buying a firm that generated more than $47bn in its 2019 fiscal year, and operates in more than 60 countries with 35,000 staff.

“Ingram Micro’s scale, diverse customer and vendor relationships and track record for innovation create the perfect platform for us to help accelerate growth, both organically and through additional M&A,” said Platinum Equity managing director Matthew Louie.

“It also provides exciting opportunities in one of the fastest-growing sectors in technology as corporations continue to migrate to cloud or hybrid solutions,” he added.

The Platinum Equity deal comes just six months after fellow private equity player Apollo Global Management sealed its acquisition of Ingram’s great rival Tech Data.

HNA acquired Ingram Micro in February 2016 for $6bn, at a time when the Chinese firm was keen on expanding its operations through making a series of major foreign investments. That has changed in the past year as the business pulls back on some of that activity.

“We are pleased to have reached an agreement that delivers a strong return on HNA’s investment while ensuring that Ingram Micro has a partner committed to investing in its future growth,” said the president of HNA Group North America, Wang Duan.

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