Private equity investor Apollo Global Management has completed its acquisition of Tech Data, and plans to invest $750 million in the industry giant.
The deal, which was first announced last November, pays holders of Tech Data common stock $145 per share, resulting in a roughly $6 billion total valuation for the company. Apollo has made a $3.75 billion equity investment in Tech Data as well.
“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,” said Tech Data CEO Rich Hume in a media statement. “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.”
Tech Data will apply the $750 million of Apollo funding toward a variety of efforts aimed at increasing its operational efficiency and agility. Those will include expanding the StreamOne cloud computing platform, optimizing and standardizing processes, and making increased use of data and analytics for decision-making.
“Apollo sees Tech Data as a strong platform for meaningful growth and further diversification, and we are committed to supporting investments that build on this vision,” said Robert Kalsow-Ramos, a private equity partner at Apollo, in prepared remarks. “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.”
Streamlining global operations and transforming the business digitally are two of the four strategic pillars Tech Data embraced three years ago when it set out to remake itself from a traditional hardware and software distributor into a “solutions aggregator” that helps end users and the partners who serve them address business needs using cloud computing, security, Internet of Things, and endpoint technologies.