Ingram Micro Invests in Net Start-Up, Names Executives

Ingram Micro Inc. in Santa Ana, the world’s largest computer products distributor, said Monday it has invested in a start-up company designed to act as a business-to-business Internet marketplace.

The new enterprise, Viacore Inc., will use a universal digital language created by RosettaNet, a consortium of technology-industry leaders, to process sales more cost-efficiently, Ingram Chief Executive Jerre Stead said.

Ingram, for example, would be able to update price information in a single stroke, rather than changing it manually in each catalog and Web site and then informing customers by fax and phone, Stead said.

“We’ll do in hours what takes weeks, months and years,” he said.

Ingram did not disclose financial details on its investment Monday, but Stead said the company would do so within the next month.

Japanese investment giant Softbank Inc. and Tech Data Corp., Ingram’s main competitor in distribution, are among Viacore’s other main investors. The rivals also worked side-by-side in RosettaNet to eliminate the obstacles caused when computer systems used by suppliers, distributors and retailers can’t understand one another.

The Viacore site is expected to be operating in March, Stead said. The new company will be run by Fadi Chehade, who took a two-year leave from Ingram to serve as RosettaNet’s chief executive.

The Viacore investment is critical to Ingram’s plan to reinvent itself as the “back room” for the e-commerce industry, using its expertise in filling orders to tap into a fast-growing market.

Though still solidly profitable, Ingram struggled last year as price-cutting and additional competition narrowed its margins. Manufacturers including Dell Computer Corp. and Gateway Inc. sold computer hardware and software directly to consumers, cutting out distributors such as Ingram.

Its profit fell 71% to $17.6 million for last year’s third quarter from $60.7 million recorded for the same period a year earlier. Quarterly revenue rose 18% to $6.7 billion from $5.7 billion.

Ingram suffered through layoffs and a corporate reorganization. More than a dozen executives left within a few months. The company’s stock price dropped from more than $52 in October 1998 to as low as $10 about a year later. The stock closed at $10.75 on Monday, down 69 cents.

In other news, Ingram named Kevin M. Murai chief operating officer of the company’s U.S. region, replacing Robert D. Grambo, who resigned after just four months in the post. Murai, 36, was president of Ingram’s Canadian unit. The company named Asger Falstrup, 50, to replace Murai.