Freshly acquired Tech Data gets set to pump $750M into digital transformation
- 01 July, 2020 09:55
Now that its US$5.4 billion acquisition by affiliates of private equity firm Apollo Global Management has reached completion, Tech Data has unveiled plans to invest around US$750 million in digital transformation initiatives over the next five years.
The global technology distributor said that the investment will underpin its strategy to accelerate innovation in ways that it hopes will deliver improved experiences and greater agility for businesses across the technology ecosystem.
The company’s digital transformation initiatives are focused on delivering state-of-the-art automation, platforms and analytics aimed at allowing it to be more agile and responsive to the rapidly evolving needs of its channel partners.
The transformation program includes building a hyper-scalable digital business platform and a cloud-based digital marketplace that are designed to support Tech Data’s “ambitious” growth plans and serve emerging technology markets and consumption models.
“Tech Data’s acquisition by the Apollo funds is a significant milestone, and their support of our multi-year commitment of resources underscores our collective focus on long-term value creation,” Tech Data CEO Rich Hume said. “We continue to execute on our strategy to transform our company into one that defines a new standard of operational and cultural excellence in our industry.
“We believe Apollo will be an invaluable partner in helping us better enable our channel partners to bring to market the technology products and solutions the world needs to connect, grow and advance.”
For Apollo private equity partner Robert Kalsow-Ramos, the private equity firm sees Tech Data as a strong platform for meaningful growth and further diversification, and he claims the investment company is committed to supporting initiatives that build on this vision.
“This investment over the next five years helps ensure the company has the resources necessary to launch a bold digital enablement and innovation program that will transform the way it serves channel partners and employees,” he said.
Private equity firm Apollo Global Management revealed last year that it had struck a deal to acquire Tech Data for US$130 per share, effectively valuing the deal at US$5.4 billion.
The completion of the buyout sees Tech Data become a privately held company.
“Over our 45-year history, Tech Data has grown to become one of the largest and most respected technology distributors in the world,” Hume said in November 2019, when the deal was announced.
“This agreement reflects the significant progress we have made in our strategy of delivering higher value and positions us for continued growth and success.”