Tech Data announced that Inflow Technologies has exercised its right to withdraw from closing its acquisition by Tech Data. As a result, Inflow has paid a break fee to Tech Data, as outlined in the original acquisition agreement, which was announced in December 2019.
“We respect Inflow’s decision to go in a different direction,” said Jaideep Malhotra, President, Asia Pacific, at Tech Data. “Tech Data is committed to our strategy of delivering higher value by strengthening our end-to-end portfolio and optimizing our global footprint, and we continue to explore opportunities to grow our business in alignment with this strategy.”
Tech Data made a major foray in the Asia Pacific market in 2017 with its US$2.6 billion acquisition of Avnet’s Technology Solutions business.
Thereafter, on December 16, 2019, Tech Data announced that it has entered into an agreement to acquire the business of Inflow Technologies. The acquisition was subject to customary regulatory approvals and is expected to close during Tech Data’s first quarter of fiscal year 2021.
Read more: Tech Data to Acquire India-based VAD Inflow Technologies
Headquartered in Bangalore, India, Inflow Technologies was founded in 2005, and was previously backed by Datatec — owner of Westcon Group — before buying back equity in August 2013.
The value-added distributor has expertise in cyber security, networking, unified communications and collaboration, in addition to storage and server management, infrastructure and application software.
Byju Pillai, president and chief executive officer, Inflow Technologies acknowledged that Inflow Technologies brings a variety of core competencies to Tech Data, including business development, channel engagement, training, and pre-sales and post-sales support.
By acquiring the business of Bengaluru-based VAD, Tech Data was looking to optimize its presence in the Asia Pacific region and offer a broader set of capabilities particularly around next-generation technologies like security.
“The addition of Inflow Technologies directly supports our strategy of delivering higher value – especially in the areas of investing in next-generation technologies, strengthening our end-to-end portfolio and optimizing our global footprint,” said Rich Hume, chief executive officer, Tech Data.
“In particular, this acquisition helps us to strengthen our portfolio of networking and security solutions we’re able to offer to our channel partners while optimizing our footprint in Asia Pacific, which is an important region for Tech Data,” Hume said.
Meanwhile, Tech Data was going through its own acquisition process as its shareholders voted to sell the company to New York Based IT firm Apollo Global Management for $6 billion.