Avnet Sells Data Center Solutions Unit to Tech Data for $2.6B

Deal expands Tech Data's data center capabilities and takes it into Asia

Yevgeniy Sverdlik

September 19, 2016

1 Min Read
(Photo by Michael Bocchieri/Getty Images)

Tech Data, a $28 billion US-based IT distributor, has agreed to acquire the data center solutions business of competitor Avnet for $2.6 billion, the companies announced Monday.

Once the deal is closed, Avnet will essentially get out of the data center business, which will enable it to focus on design chain and supply chain services and expand into new markets, such as the Internet of Things and digital platforms, its CEO, William Amelio, said in a 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 said.

For Tech Data, the transaction greatly expands its data center solutions capabilities to make it more of an end-to-end technology solutions firm and gives it a foothold in Asia. The combined company will get about 3 percent of its revenue from the high-growth region when the transaction is complete.

Avnet and Tech Data plan to partner on providing end-to-end IoT solutions.

This is a second major transaction in the IT distributor space this year. In February, Ingram Micro, one of the world's biggest IT distributors, agreed to be acquired by the Chinese conglomerate HNA Group for $6 billion.

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