Datatec completes sale of Westcon Americas to SYNNEX
ICT group Datatec has completed the sale of its Westcon-Comstor business in North America and Latin America and of 10% of the remaining part of Westcon to SYNNEX.
The proceeds of the transaction comprise $630 million in cash on completion and up to $200 million payable as a cash earn-out, subject to Westcon Americas meeting certain agreed gross profit performance targets.
The maximum consideration of $830 million equates to an equity valuation of the total Westcon-Comstor division of $1.1 billion.
The board will be reviewing options for the use and distribution of the cash proceeds received on closing of the transaction.
The board intends to retain $130 million for various operational and working capital and expansion funding requirements. It will consider returning the majority of the remaining $500 million to shareholders by way of share repurchases and / or a specific dividend, but in the meantime the proceeds will be retained in US dollars.
The board has previously communicated that any cash payments received on the earn-out will be returned to shareholders.
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