UBJ News
Synnex to Buy IBM’s Customer Care Services Unit Synnex Corp. announced it would buy IBM’s worldwide business process outsourcing services business for $505 million. The acquired business is valued at more than $1.2 billion. The purchase price consists of about $430 million in cash and $75 million in stock. Synnex officials said having IBM take an equity stake in the company underscores the importance of the ongoing relationship. The acquisition will be branded and fully integrated with Concentrix, a wholly owned subsidiary of Synnex. Concentrix will provide customer care services for clients in more than 12 industries. Synnex’s U.S. distribution is headquartered in Greenville. The Fremont, Calif.-based company’s
primary services are wholesale distribution, contract assembly and business process outsourcing. Information about whether the acquisition will lead to expansions or changes at the Greenville operations will not be available until closer to the closing. But Synnex Chief Financial Officer Marshall Witt said in a conference call that the deal will be closed in phases, and Synnex expects “to receive the economic benefits for the entire business, including those geographies and entities that have yet to close.” In addition to the sale, the companies have entered into a multiyear agreement in which Concentrix will become an IBM strategic business
partner for global customer care business process outsourcing services. “We are very excited to bring together these two great teams, each recognized by their clients as leaders in providing outstanding and innovative solutions,” said Kevin Murai, Synnex president and CEO, in a news release. “This acquisition will significantly extend our portfolio of offerings and delivery capabilities that will make Concentrix a global top 10
player in this growing market.” Concentrix President Chris Caldwell said in the conference call that the market is still fragmented, with the top 10 companies holding just 30 percent of the market share and consolidation expected to continue. The acquired business will eventually operate under the Concentrix name. The companies will continue to operate independently until the deal is finalized in the coming months. Synnex estimates revenues for the quarter that ended Aug. 31 are $2.65 to $2.75 billion. The company will release its most recent earnings results on Sept. 25.
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