Ingram Micro to Become Leading Provider of Mobility Products, Services and Solutions With Acquisition of Brightpoint
Services and Solutions With Acquisition of Brightpoint
GlobeNewswire 2012-07-02
-- Provides Immediate Scale in Rapidly-Growing Mobility Market
-- Expands Ingram Micro's Suite of High-Value Logistics Services and
Solutions
-- More than $55 million in Expected Annual Cost Synergies and Efficiencies
by 2014
-- All Cash Acquisition Expected to Expand Margins and be Meaningfully
Accretive to Earnings per Share
SANTA ANA, Calif. and INDIANAPOLIS, July 2, 2012 (GLOBE NEWSWIRE) --
Ingram Micro Inc. (NYSE:IM), the world's largest technology distributor
and supply-chain services provider, and Brightpoint, Inc.
("BrightPoint") (Nasdaq:CELL), a global leader in providing device
lifecycle services to the wireless industry, announced today they have
entered into a definitive agreement under which, subject to customary
closing conditions, Ingram Micro will acquire all of the outstanding
shares of BrightPoint common stock for $9.00 per share in cash, a 66
percent premium to BrightPoint's closing stock price on June 29, 2012,
and a 35 percent premium to the 90-day average trading price. The
transaction is valued at approximately $840 million, including the
value of approximately $190 million of BrightPoint's estimated debt
(net of cash), as of June 30, 2012.
The complementary combination of Ingram Micro with BrightPoint will
create a leading global provider of device lifecycle services and
solutions for the mobility industry. Together, Ingram Micro and
BrightPoint will have tremendous customer reach and deep relationships
with key vendors, network operators and mobile virtual network
operators. The combined company will have an expanded global geographic
footprint and customer base in the rapidly growing and strategically
important mobility market.
"BrightPoint is a well-run company with leading, high-value services
and solutions coupled with excellent distribution channels in the
global mobility market," said Ingram Micro president and chief
executive officer Alain Monie. "BrightPoint's offerings are highly
complementary to both our logistics and distribution businesses, which
will enable us to go to market with the leading portfolio of mobility
device lifecycle services and solutions. Our expanded geographic
footprint and strong financial position create growth opportunities for
the combined company and give vendors, network operators and mobile
virtual network operators, partners and customers one-stop access to
one of the widest ranges of mobility and technology products, services
and solutions.
"Strategically, it is a great fit and is immediately additive to Ingram
Micro's existing offerings," Monie added. "Expanding our presence in
the mobility market has been a focus of Ingram Micro and the
acquisition of BrightPoint accomplishes this to an extent that would
have been challenging to achieve on our own. Additionally, the
complementary nature of our businesses provides a unique opportunity to
drive synergies and efficiencies across the combined companies, which
is expected to result in meaningful accretion to earnings per share
beginning in 2013. The transaction clearly supports our longer-term
growth and profitability targets and meets our return-on-investment
criteria for creating shareholder value."
BrightPoint, established in 1989 and with corporate offices in
Indianapolis, generated $5.2 billion in revenues, of which nearly $550
million was from unique value-added logistics services, and total gross
margin of approximately 7.2 percent of revenues for the 2011 fiscal
year. The company employs approximately 4,000 people and operates
facilities in 24 countries, with sales in more than 75 countries around
the world. BrightPoint serves more than 25,000 B2B customers with over
100,000 points of sale across the globe and handled more than 112
million wireless devices in 2011.
BrightPoint founder, chairman and chief executive officer Robert J.
Laikin commented: "The transaction with Ingram Micro will deliver
significant value to our shareholders and will enable us to accelerate
our global growth strategy. This powerful combination will also provide
compelling opportunities for BrightPoint's vendor partners, customers
and employees to benefit from the financial strength, scale and broad
geographic reach of the world's largest technology distribution
company. This is the right time for this transaction. I believe
strongly that Ingram Micro is the best partner for our business and
employees going forward and I am excited at the prospect of BrightPoint
becoming part of a Fortune 100 company."
"Ingram Micro and BrightPoint share a common culture," said Ingram
Micro chief operating and financial officer Bill Humes. "We admire the
in-depth industry expertise and enthusiasm of the BrightPoint team and
their excellent long-term relationships with customers, vendor
partners, network operators and mobile virtual network operators. The
mobility industry is forecasted to grow faster than other technology
sectors, driven in-part by exponential growth in the smartphone and
tablet segments due to the ever-increasing demand for access to data
anytime, anywhere and on any device. Additionally," Humes said, "the
convergence of telecommunications, computing and media is driving
strong demand and should lead to cross-sell and up-sell opportunities,
as our respective customer bases continue to converge. Together we
expect to capitalize on this growth and generate benefits for our
combined vendors, partners, customers, associates and shareholders
greater than either company could on its own."
Ingram Micro expects to fund the transaction with existing credit
facilities and available cash balances. Ingram Micro has obtained a
commitment for a $300 million debt facility to be provided by Morgan
Stanley Senior Funding, Inc., which would supplement its existing
committed debt capacity. Ingram Micro expects to realize annual cost
synergies and efficiencies in excess of $55 million by 2014, and the
transaction is expected to be accretive to earnings per share by at
least 18 cents in 2013 and 35 cents in 2014, excluding one-time charges
and integration costs.
The following members of BrightPoint's senior management team have
committed to senior roles within the new organization after the
acquisition is complete: existing Regional Presidents, Mark Howell
(Americas), Bruce Thomlinson (APAC) and Anurag Gupta (EMEA), and
Vincent Donargo, BrightPoint's Chief Financial Officer. In addition,
Robert Laikin will serve in a senior advisory role to Alain Monie.
The transaction requires approval of a majority of BrightPoint's
outstanding shares at a special meeting, which is expected to take
place in the 2012 third quarter. Closing of the transaction is also
conditioned on customary regulatory approvals. The transaction is
expected to close before the end of the year.
Davis, Polk & Wardwell LLP acted as outside counsel and Morgan Stanley
& Co. LLC acted as the exclusive financial advisor to Ingram Micro in
connection with the transaction. Blank Rome LLP acted as outside
counsel and Blackstone Advisory Partners L.P. acted as the exclusive
financial advisor to BrightPoint in connection with the transaction.
Conference Call and Webcast
There will be a conference call today to discuss the transaction at
8:00AM PT. Investors may listen to the conference call by dialing (800)
369-2005 or (210) 839-8501 outside the United States and Canada, or
access the call via a live audio webcast at www.ingrammicro.com
(InvestorRelations section). A replay of the conference call will be
available for one week at www.ingrammicro.com (Investor Relations
section) or by calling (866) 435-1317 or (203) 369-1016 outside the
United States and Canada.
Cautionary Statement for the Purpose of the Safe Harbor Provisions of
the Private Securities Litigation Reform Act of 1995
The matters in this press release that are forward-looking statements
are based on current management expectations. Certain risks may cause
such expectations to not be achieved and, in turn, may have a material
adverse effect on Ingram Micro's business, financial condition and
results of operations. Ingram Micro disclaims any duty to update any
forward-looking statements.
All statements other than statements of historical fact are statements
that could be deemed forward-looking statements.
Important risk factors that could cause actual results to differ
materially from those discussed in the forward-looking statements
include, without limitation: our ability to timely complete the
transaction, if at all; our ability to complete the transaction
considering the various closing conditions, including those conditions
related to regulatory approvals and shareholder approval; the financial
performance of BrightPoint and Ingram Micro through the completion of
the merger; BrightPoint's business may not perform as expected due to
transaction-related uncertainty or other factors; the ability of
BrightPoint and Ingram Micro to retain relationships with customers,
vendors and carriers; management's ability to execute its plans,
strategies and objectives for future operations, including the
execution of integration plans; growth of the mobility industry; our
ability to maintain access to adequate levels of capital at reasonable
rates; and our ability to achieve the expected benefits and manage the
expected costs of the transaction.
For a further discussion of significant factors to consider in
connection with forward-looking statements concerning Ingram Micro,
reference is made to Item 1A Risk Factors of Ingram Micro's Annual
Report on Form 10-K for the fiscal year ended December 31, 2011 and
Item 1A Risk Factors of Ingram Micro's Quarterly Report on Form 10-Q
for the fiscal quarter ended March 31, 2012; other risks or
uncertainties that may be detailed from time to time in Ingram Micro's
future SEC filings.
About Brightpoint, Inc.
Brightpoint, Inc. (Nasdaq:CELL) is a global leader in providing device
lifecycle services to the wireless and high-tech industries. In 2011,
BrightPoint handled more than 112 million wireless devices globally.
BrightPoint's 5 key service areas -- Plan, Market, Customize, Move,
Recover, offer over 110 innovative services, such as distribution
channel management, procurement, inventory management, reverse
logistics and repair services, software loading, kitting and customized
packaging, fulfillment, product customization, eBusiness solutions, and
other outsourced services that integrate seamlessly with its customers'
IT systems and operations. BrightPoint's effective and efficient
platform allows its customers to benefit from rapidly deployed,
flexible and cost effective solutions. BrightPoint has more than 4,000
employees, as well as a significant number of temporary staff, and a
global footprint covering more than 35 countries, including 13 Latin
American countries through its investment in Intcomex, Inc. In 2011,
BrightPoint generated revenue of $5.2 billion, from customers in over
75 countries. BrightPoint provides distribution and customized services
through over 100,000 points-of-sale and to over 25,000 B2B customers
worldwide. Additional information about BrightPoint can be found on its
website at www.BrightPoint.com, or by calling its toll-free Information
and Investor Relations line at 877-IIR-CELL (877-447-2355).
About Ingram Micro Inc.
As a vital link in the technology value chain, Ingram Micro creates
sales and profitability opportunities for vendors and resellers through
unique marketing programs, outsourced logistics, technical and
financial support, managed and cloud-based services, and product
aggregation and distribution. The company is the only global
broad-based IT distributor, serving 145 countries on six continents
with the world's most comprehensive portfolio of IT products and
services. Visit www.ingrammicro.com.
Additional Information and Where to Find It
BrightPoint intends to file with the Securities and Exchange Commission
(the "SEC") a proxy statement and intends to furnish or file other
materials with the SEC in connection with the proposed merger. The
definitive proxy statement will be sent or given to the shareholders of
BrightPoint and will contain important information about the proposed
merger and related matters. BEFORE MAKING ANY VOTING DECISION,
BRIGHTPOINT'S SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT AND
THOSE OTHER MATERIALS CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT BRIGHTPOINT AND THE PROPOSED
MERGER. The proxy statement and other relevant materials (when they
become available), and any other documents filed by BrightPoint with
the SEC, may be obtained free of charge at the SEC's website at
www.sec.gov. In addition, security holders will be able to obtain free
copies of the proxy statement from BrightPoint by contacting
BrightPoint's Investor Relations by telephone at (317) 707-2745, or by
mail at BrightPoint, Inc., 7635 Interactive Way, Suite 200,
Indianapolis, Indiana, 46278, Attention: Investor Relations, or by
going to BrightPoint's Investor Relations page on its corporate website
at www.BrightPoint.com.
Participants in the Solicitation
BrightPoint and its directors and executive officers may be deemed to
be participants in the solicitation of proxies from the shareholders of
BrightPoint in connection with the proposed merger. Information
regarding the interests of these directors and executive officers in
the merger will be included in the proxy statement described above.
Additional information regarding these directors and executive officers
is included in BrightPoint's proxy statement for its 2012 Annual
Meeting of Shareholders, which was filed with the SEC on March 23,
2012, and in BrightPoint's Annual Report on Form 10-K for the year
ended December 31, 2011, which was filed with the SEC on February 29,
2012.
(C) 2012 Ingram Micro Inc. All rights reserved. Ingram Micro and the
registered Ingram Micro logo are trademarks used under license by
Ingram Micro Inc.
CONTACT: Investors:
Damon Wright (714) 382-5013
damon.wright@ingrammicro.com
Tom Ward (317) 707-2745
tom.ward@brightpoint.com
Media:
Lisa Zwick (949) 230-8794
lisa.zwick@ingrammicro.com
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