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LONDON, UK / ACCESSWIRE / June 8, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for SYNNEX Corp. (NYSE: SNX). The Company announced on June 05, 2017, that it has entered into a definitive agreement with Datatec Ltd, under which it would acquire Datatec's Westcon-Comstor Americas business. Post the transaction, SYNNEX will become a minority shareholder in Datatec's Westcon EMEA and APAC businesses. For immediate access to our complimentary reports, including today's coverage, register for free now at:
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Details of the Transaction
SYNNEX will pay a total of $600 million for the acquisition, which is structured in the form of $500 million in stock and $100 million in cash, at the closing of the transaction. The Company will also facilitate up to $200 million earns out if certain financial milestones are achieved through February 2018. SYNNEX will pay $30 million for the 10% minority stake in Datatec's Westcon EMEA and APAC businesses. The Company will assume about $115 million of net debt and refinance it with the close of the transaction. SYNNEX holds the option to execute the agreement in an all-cash transaction, based on the average share price at closing.
The Westcon-Comstor Business
The Westcon-Comstor is a value-added technology distributor of category-leading solutions in Security, Collaboration, Networking, and Data Center. The Westcon Americas business generated net revenues of about $2.2 billion for full-year FY16, ending February 28, 2017. In the first 12 months, post the closing, the Westcon Americas business, excluding transaction expenses, intangible amortization, and integration costs, is expected to be mildly accretive to the Company's non-GAAP EPS. The transaction is expected to close in the Q3 2017, subject to satisfaction of regulatory requirements and customary closing conditions. The Companies will continue to operate independently till the transaction is completed.
Growth Prospects
SYNNEX views this acquisition as a transformational step and finds the business complementary to its portfolio, where technology is growing. Westcon-Comstor, being a leader in the Security, UCC and networking space, offers global expansion opportunities as the Companies share a common vision to address the global complexities and emerging demands of their respective clients.
On May 09, 2017, SYNNEX announced that it has been designated as the exclusive North American distributor of HP's Jet Fusion 3D Printing solution. According to a report, the enterprise 3D market is set to grow at 57.4% for the next three years. During this rapid period of growth, this agreement offered SYNNEX the opportunity to ease resellers' entry and expansion in the 3D printing segment. SYNNEX is the only HP distribution partner in the US authorized for all HP printer products and is the source for the HP Jet Fusion 3D solution and materials.
Prior to the announcement, on April 20, 2017, the Company was selected by Symantec Enterprise security solutions, to deliver its full portfolio. The addition of the full Symantec security portfolio offered SYNNEX the scale to address the ever-evolving threat landscape as well as the changes and challenges presented due to rapid market shift to mobile and cloud ecosystems.
On March 29, 2017, SYNNEX expanded its networking portfolio by adding the Brocade Ruckus ICX campus switches. The expanded capabilities are delivered through SYNNEX's CONVERGESolv Advanced Technologies support platform, designed to help resellers advance technologies that support third-party infrastructures and deployment.
Last Close Stock Review
SYNNEX's share price finished yesterday's trading session at $114.77, slightly advancing 0.17%. A total volume of 227.46 thousand shares exchanged hands, which was higher than the 3 months average volume of 195.76 thousand shares. The stock has surged 5.43% and 20.22% in the last one month and past twelve months, respectively. The stock is trading at a PE ratio of 18.36 and has a dividend yield of 0.87%. The stock currently has a market cap of $4.61 billion.
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