Mercury IT shoots for the big league
- 15 December, 1999 12:56
The Australian reseller channel may soon have another national contender after an ascendant NSW-based retail and integration group acquired a large stake in one of South Australia's largest locally owned resellers.
Sydney-based The Mercury Group (TMG), which comprises Mercury IT, Laptop Land and Mercury Services Group, announced last week that it had acquired a majority shareholding in Lodin Computer, a prominent value-added reseller which recovered from voluntary administration last September.
The company is now scouring Melbourne for suitable equivalents with a view to securing a national presence in the immediate future.
According to Derek Merdith, managing director of TMG, the Lodin purchase is a move that signals the next step in its national expansion plans. As a result, TMG, which already has a strong presence in NSW and Queensland, is emerging as one of the premier mobile solutions organisations in the country, although that is not all it does.
"Lodin will almost immediately be rebranded as Mercury IT," Merdith said. "This gives us coverage in Adelaide and you will probably also see a Laptop Land presence there in the near future."
Craig Cox, Lodin's general manager of marketing, said that the deal lifts a weight off the shoulders of the company and will allow it to move forward rapidly.
"We are excited about the merger with Mercury IT," he said. "We have been operating under a cloud but we are very impressed with the Mercury Group methodologies."
Lodin's managing director, Roger Godwin, denied the Mercury Group takeover was linked to the administration, which had "only lasted a matter of weeks", he said.
"We needed to partner with a strong player to firm up the operation we had in Adelaide," was how Godwin described the sale. "I was trying to do this two or three years ago and it is the manifestation of that early work."
Merdith was understandably coy about future expansion but indicated there were "long-term plans" that included getting heavily involved in enterprise mobile computing solutions and acquiring a "national presence".
"The obvious next move is to get into Melbourne," Merdith said, adding that the TMG business model has proven a success and really only needs to be replicated for national expansion.
Godwin said the biggest difference for Lodin's retail and integration operations will be its ability to leverage off TMG's national business. "For example, they are already looking at how they can use our Lotus Notes skills."
Merdith suggested that the rosy future that he and others are predicting for mobile computing complemented Mercury IT's focus on sales force automation and Laptop Land's retail success in a rapidly expanding market. He said the whole mobile solutions market is set to boom and it is those that are already there that will reap the most benefit.
"Telecommunications, wireless connec-tivity and computing mobility will be the focal point of technology in the future," Merdith said.
"The barriers to getting in [to mobile solutions] are large and hard to circumnavigate.
"The logical direction for computing is smaller, lighter and TFT screens. That means laptops, mobile phones and handheld devices."
Merdith also pointed to the fact that the hardware sales are logically going to be followed by serious application development for wireless handhelds.
"We picked up that trend 10 years ago and that is now one of our core competencies," he said of the direction in which Mercury Services has been heading.
Godwin agreed there was strength in the group's new national front. "As a combined organisation nationally, we take a much bigger position with partners we are dealing with at a national and local level. It gives you a bit more firepower.
"We have to join the big boys and not sit here bemoaning our fate because we're in a small market. You either do it or get out. I'm very positive about our future."
Lodin Computer was established about 12 years ago and developed into a major Adelaide reseller of tier-one brands, including Compaq and Toshiba, as well as its home brand of PCs.