Wonder whether Westcon and Ingram Micro chief execs, Alan Marc Smith and Kent Foster, hooked up for a lunch of late? As the former summonsed his local head of operation Nick Verykios for another strategic session in New York, and the latter sent a messenger to Sydney with the news of potential acquisition, would it be too far fetched to assume a serviette deal could be on its way?
In his whirlwind visit to Sydney last week, Ingram’s regional head honcho, Hans Koppen, made no bones about it — lunch or not, he was on the hunt.
Koppen said the time had come for Ingram to tackle TP for the number one spot. He wants Ingram on top by the end of the next three-year replacement cycle. Except for two things: TP’s HP volumes are a tall order, and Koppen’s just placed all his bets on the regional wireless market.
Now, Ingram’s local operation doesn’t really have a strong enough networking leg to stand on, so Koppen figured there were only two things he needed to do — one was to push global partner Cisco for local distribution rights; the other was to woo a distie with the expertise and client base to complement it under its wing.
On the other hand, it is fair to assume that the combined volumes of a neat outfit like Dicker Data and IM would certainly give TP a good run for its money in the HP game. So what’s it gonna be? “You’ll have to figure it out for yourselves,” Koppen teased.
Enter Einstein logic and two obvious choices — Express Data and Lan Systems.
It’d be easy to speculate about Dimension Data’s willingness to divest of its only distribution business in a worldwide maze of services and integration outfits. The move has been on the cards ever since the $US1.9 billion global integration giant acquired ComTech in 2000, not least of all because of the conflict of interest the company was seeing between its distribution and integration arms.
Meanwhile, Westcon and its parent company Datatec are still holding on to the struggling LAN Systems, following the executive intervention last year that saw the distributor lay off 11 staff due to a sharp drop in revenue. LAN’s general manager, the always flamboyant master of media relations Nick Verykios, may claim with his usual flair and bravado that things are looking up for the company, as Cisco resellers choose to shun direct relationship with the vendor and revert to distribution. But the real picture probably looks a lot less promising for Verykios as he flies to the US once again, probably in search of additional support from his parent company.
As a network pure-player with a great track record in servicing its market, LAN’s current vulnerability plays in the hands of network-focused Koppen, whose acquisition plans may be just what doctor has ordered for Westcon’s troubled child and Koppen’s Cisco plans.
On the other side, ED could strengthen Ingram’s value proposition both in the networking and storage spaces, where Ingram’s Simms acquisition failed to deliver the desired revenue outcomes. Further, Ingram’s regional focus on wireless integration and services driven out of Singapore could definitely benefit from ED’s technical expertise.
One may be a more obvious choice than the other, but as the English proverb says — Ingram may not be rich enough to make cheap(er) choices.
So what’s it gonna be? Well, as Koppen says, you’ll have to figure it out for yourselves.