DOW JONES NEWSWIRES
Avnet Inc. (AVT) agreed to acquire fellow technology distributor
Bell Microproducts Inc. (BELM) for $252 million as Avnet looks to
bulk up as the technology sector has been rebounding.
Both companies, which distribute computers among other items,
also said their current-quarter sales will be at the high end of
their prior expectations, while Avnet said earnings will top
previous estimates.
Bell holders would get $7 a share, a 30% premium to Friday's
closing price. The stock was at 50 cents a share ago but traded
above $7 as recently as 2007. Including assumed debt, the deal is
valued at $594 million.
Among other positives about the deal, Avnet's Chairman and Chief
Executive Roy Vallee said buying Bell will give it increased access
to "the fast-growing Latin America market. Bell's position in
datacenter products and embedded systems complements Avnet's
current strategies and creates opportunities for cross selling."
Bell's position as one of the leaders in hard disk drive
distribution substantially increases Avnet's exposure to this
product segment, which is currently focused on embedded
computing.
Avnet shares closed Friday at $28.37 and were inactive
premarket. The stock is up 55% the past year.
-By Jodi Xu and Kevin Kingsbury, Dow Jones Newswires;
212-416-3037; jodi.xu@dowjones.com