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HNA seals $6b deal for Ingram Micro

By Wang Ying | China Daily | Updated: 2016-12-07 07:40

China's aviation and shipping conglomerate HNA Group closed a $6 billion acquisition of the world's top IT products distributor Ingram Micro Inc on Tuesday.

In a regulatory filing on Tuesday, New York-listed Ingram Micro said that the deal was completed.

After the transaction, Ingram Micro will be delisted from the New York Stock Exchange and become the largest member enterprise of HNA in terms of revenue.

Shanghai-listed Tianjin Tianhai Investment Co Ltd, an arm of HNA, executed the all-cash deal on behalf of HNA Group.

Ingram Micro reported $43 billion revenue and $215 million net profit in 2015, far above Tianjin Tianhai's 720 million yuan ($104.98 million) revenue and 248 million yuan net profit during the same period.

However, due to worsening performance in the US and European markets, Ingram Micro's revenue and net profit declined 7.4 percent and 19.3 percent in 2015, respectively.

Analysts said traditional IT product distributors are being affected by the changes brought by mobile internet, greater concentration of IT enterprises along the industry chain, and the rise of major e-commerce behemoths.

"This is a world-level deal for HNA, not only in terms of its success, but also the significance of the deal," said Li Lei, an industrial analyst from Minzu Securities Co.

"With the help of Ingram Micro, HNA would gain access to business opportunities in emerging markets, and have higher growth rates and improved profitability," said Adam Tan, vice-chairman of the board of directors and CEO of HNA in February.

Furthermore, Ingram Micro will be of significant help as HNA Group is aiming to transform from a logistics operator to a supply chain operator, added Tan.

Alain Monie, Ingram Micro CEO, said: "Ingram Micro will now be part of a larger organization that has complementary logistics capabilities and a strong presence in China that can further support the growth and profitability objectives of our vendor and customer partners."

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