Tiger Midco, an affiliate of certain funds managed by affiliates of Apollo Global Management, have completed its acquisition of Tech Data, one of the world’s largest technology distributors. Chief Executive Officer Rich Hume will continue to lead Tech Data from its headquarters in Clearwater, Florida. As a result of the completion of the merger, shares of Tech Data’s common stock no longer trade on the NASDAQ Global Select Market. Tech Data’s shareholders are entitled to receive €128 in cash for each share of Tech Data common stock owned.
“Tech Data is a global, market-leading company with an excellent management team and significant opportunities for expansion”, said Matt Nord, Co-Lead Partner of Private Equity at Apollo. “As a result of this acquisition and the resources we can bring to bear, Rich and the Tech Data team will have the strategic and financial flexibility to invest in new technology, expand services and pursue transactions that we believe will drive long-term value creation.”
Tech Data CEO Rich Hume said: “we are excited to enter Tech Data’s next chapter as a private company with our new sponsors at Apollo who have a track record of building great businesses in our sector. Having a single, strategic equity owner that’s fully aligned with our mission we believe gives us a real advantage in accelerating our transformational strategy and allows us to think more creatively – without the short-term demands that can come with public ownership.”
The transaction gives Tech Data an enterprise value of approximately €5.3 billion and included a €3.32 billion equity investment made by Apollo. With approximately 2.5x leverage, Tech Data is one of the highest credit quality, lowest levered sponsor-backed companies. As part of its go-forward plan, over the next five years Tech Data plans to invest approximately €660 million in digital transformation initiatives to better serve its channel partners. This includes investments in technology to expand its StreamOne Cloud Platform, optimise and standardise processes and apply data and analytics to be more agile in a rapidly evolving environment.
Apollo Private Equity Partner Robert Kalsow-Ramos added: “Tech Data benefits from exceptional global capabilities, a strong financial position and a values-driven corporate culture, all within an industry that continues to experience strong secular growth. We are excited to now leverage Apollo’s resources and experience to support the management team and take Tech Data to the next level of industry leadership and service to its customers, including thousands of small- and medium-sized businesses around the world. Today’s announcement of a €660 million investment in digital transformation is a testament of this focus and our commitment to Tech Data’s long-term growth.”