PC Mall looks to expand b2b presence with SARCOM purchase
PC Mall Inc., a direct marketer and web retailer of personal computer and related gear, has agreed to acquire SARCOM Inc., an information technology software and service provider that targets business customers. PC Mall, which operates PCMall.com, will pay an aggregate purchase price of $55 million consisting of $47.5 million in cash and up to $7.5 million in shares of PC Mall stock.
PC Mall, No. 73 in the Internet Retailer Top 500 Guide, says the acquisition will enhance its capabilities as a reseller of advanced technology and services. The move is consistent with PC Mall’s strategy to grow by expanding the company’s share of its customers’ I.T. spending.
The acquisition will involve merging Wareforce, a PC Mall subsidiary, into SARCOM, which will become a wholly-owned subsidiary of PC Mall. The transaction is expected to close in the third quarter of 2007.
SARCOM customers include mid-market corporate clients, health care organizations, and government, education, and non-profit organizations in the U.S. SARCOM had revenue of approximately $248 million for the year ended December 31, 2006, and approximately $162 million for the seven months ended July 31, 2007, PC Mall says, an increase of 23% compared with approximately $132 million for the seven months ended July 31, 2006.
The $55 million purchase price is subject to adjustment on a dollar for dollar basis to the extent that SARCOM’s net asset value is greater or less than $19.6 million at closing, PC Mall says.
The acquisition enables PC Mall to leverage the technology capabilities of Wareforce and SARCOM “to address the growing need of our customers for more sophisticated and comprehensive solutions,” says Frank Khulusi, PC Mall’s president and CEO. “Many of our manufacturer partners are looking for resellers such as PC Mall to provide a higher level of value in supporting complex solutions in today’s markets and we believe that our acquisition of SARCOM will significantly enhance our ability to do that.”
Back...
