Ingram Micro gets Brightpoint for $840M - The Deal Pipeline (SAMPLE CONTENT: NEED AN ID?)
Subscriber Content Preview | Request a free trialSearch  
  Go

Telecom, Media & Technology

Print  |  Share  |  Reprint

Ingram Micro gets Brightpoint for $840M

by Demitri Diakantonis  |  Published July 2, 2012 at 3:52 PM
ingram.jpgTechnology products distributor Ingram Micro Inc. said Monday, July 2, that it agreed to acquire rival Brightpoint Inc. for $9 per share, or $840 million.

Santa Ana, Calif.-based Ingram Micro will pay $650 million in cash and will assume $190 million in debt.

The purchase price represents a 66% premium over Brightpoint's June 29 closing stock price of $5.41. News of the deal sent Brightpoint shares soaring by about 63%, to $8.84, by Monday afternoon.

The buyer will fund its acquisition through a combination of cash and debt. Ingram said it has a $300 million debt commitment from Morgan Stanley Senior Funding Inc. in addition to its current credit facility.

Brightpoint provides repair services, inventory management and software loading to the mobile device industry.

"Expanding our presence in the mobility market has been a focus of Ingram Micro and the acquisition of Brightpoint accomplishes this to an extent that would have been challenging to achieve on our own," Ingram Micro CEO Alain Monie said in a statement, adding that the two companies share a similar business culture and customer base.

Ingram Micro said demand for smartphones and tablets have made mobile devices the most attractive segment of the technology sector.

Brightpoint of Indianapolis, founded in 1989, generated 2011 revenue of $5.2 billion. The company has more than 4,000 employees with operations in 24 countries.

"The transaction with Ingram Micro will deliver significant value to our shareholders and will enable us to accelerate our global growth strategy," Brightpoint founder and CEO Robert Laikin said in a statement.

Ingram Micro expects to realize annual synergies of about $55 million from the acquisition by 2014 and expects to add about 18 cents per share in 2013. It said Brightpoint's senior management will remain in place after the deal closes.

Sean Madnani, Justin Aylward, Travis Madlem and Tsendai Chagwedera of Blackstone Advisory Partners LP advised Brightpoint, which was represented by Blank Rome LLP.

Morgan Stanley advised Ingram Micro, which received legal counsel from a Davis Polk & Wardwell LLP team that included Alan F. Denenberg, Mischa Travers, Peter M. Lamb and Tyler P. Pender.

The two sides expect to complete the transaction by year's end, pending regulatory and shareholder approval.

Ingram Micro shares traded up 17 cents, to $17.64, on Monday afternoon, giving it a market capitalization of about $2.7 billion.
Share:
Tags: Alain Monie | Alan F. Denenberg | Blackstone Advisory Partners LP | Blank Rome LLP | Brightpoint Inc. | Davis Polk & Wardwell LLP | Ingram Micro Inc. | Justin Alward | Mischa Travers | Morgan Stanley | Peter M. Lamb | Robert Laikin | Sean Madnani | Travis Madlem | Tsendai Chagwedera | Tyler P. Pender

Free preview

This is only a preview of The Deal's sophisticated coverage. Explore the real-time intelligence as researched and reported on by our team of financial journalists with a license to The Deal Pipeline. Click here for more information.

Meet the journalists

Demitri Diakantonis

Reporter: Middle Market

Contact



Movers & Shakers

Launch Movers and shakers slideshow

Goldman, Sachs & Co. veteran Tracy Caliendo will join Bank of America Merrill Lynch in September as a managing director and head of Americas equity hedge fund services. For other updates launch today's Movers & shakers slideshow.

Video

Fewer deals despite discount debt

When will companies stop refinancing and jump back into M&A? More video

Sectors