Ingram Sees Australian Interest as Footing in Pacific Rim Market
Hoping to gain a strong foothold in the fast-growing Pacific Rim computer market, Ingram Micro D said Thursday that it has tentatively agreed to buy a 33% interest in a large Australian computer distributor.
Ingram Micro D, the nation’s largest independent distributor of personal computer products, said it will pay $2.4 million for a one-third interest in Imagineering Technology Ltd. of Sidney, Australia. Under terms of the deal, the Santa Ana company also would provide $9.4 million in capital to the Australian firm, said Linwood A. (Chip) Lacy, Ingram Micro D’s chairman and chief executive.
Lacy said the deal would fulfill a key company goal to establish itself as a major overseas supplier of computer products and gain a strong presence in the Far East.
“Our strategy is to have three worldwide markets in North America, Europe and the Pacific Rim,” Lacy said. “We also like having a partner that knows Asia. If you consider Imagineering as part of our group, then we’ll be larger in international sales than any other distributor.”
Ingram Micro D posted sales of $367 million for the third quarter ended Sept. 30, and it expects to report annual sales $1.45 billion. The privately held company does not report earnings.
Ingram Micro D’s partner in the deal is First Pacific Co. Ltd, a diversified Hong Kong company with real estate, banking and telecommunications interests. First Pacific, which currently owns 42% of Imagineering, would invest $17.9 million in capital and increase its stake to 67% if the deal goes through.
Together, Ingram Micro D and First Pacific will offer 47 cents a share to shareholders who hold the 58% of Imagineering stock not owned by First Pacific. That represents a hefty premium over Imagineering’s current trading price of 21 cents a share,
The deal is subject to several conditions, including Australian government approvals, the renegotiation of Imagineering’s current loans, and a due diligence review by Ingram Micro D, Lacy said. The deal is expected to close between Feb. 15 and March 1 next year.
Under the agreement with First Pacific, Ingram Micro D has the option of increasing its stake in Imagineering to up to 49% between 1993 and 1995.
The Australian firm distributes computer products in the Pacific Rim, including Australia, New Zealand, Hong Kong, Singapore, Malaysia, Taiwan, the Philippines and Indonesia. It expects to report sales of $202 million this year.
