Westcon, the distribution arm of JSE-listed IT group Datatec, will acquire Iberian and Latin American multinational security, virtualisation and data centre distributor Afina Group in a deal worth as much as €50m (R516m).
The deal is being done by way of Westcon’s acquisition of Afina’s holding company, Panama-based GLS Software, from Araguaya.
“The transaction, valued at up to E50m, expands Westcon’s presence in Latin America, the Caribbean, Europe and North Africa,” Datatec says in a statement.
“It also broadens and deepens Westcon’s product portfolio through the addition of new (or stronger) relationships with strategic vendors such as VMware, Riverbed, Symantec and Citrix.”
Datatec says the transaction will be settled by the payment of E30m in cash funded from new loan finance and €10m in Datatec shares. The remaining E10m will be paid in cash in two payments of up to €5m each in 2013 and 2014, subject to Afina meeting certain earnings performance conditions.
“We identified Afina more than two years ago as a potentially game-changing opportunity for Westcon,” says Datatec CEO Jens Montanana. “The transaction adds major high-growth emerging markets to Westcon’s geographic footprint and cements its leadership role as the world’s premier distributor of networking and security products.”
He says the deal forms an important “milestone” in the group’s aim of generating US$1bn of revenues in security-related products in the medium term. It also brings software virtualisation and data-centre products to Westcon.
Afina was founded in 1990 and is headquartered in Madrid and Miami. It employs over 400 people and expects revenues this financial year to be nearly $300m. It operates in 12 countries across Latin America, Europe, North Africa and the Caribbean. Its operations in Brazil will augment Westcon’s strong presence in that market, Montanana says.
“Latin America is now entering a robust period of IT spending, with analysts estimating that the region will generate more than $310bn in IT spending in 2012,” he says. “With the acquisition of Afina, Westcon is very well positioned to capture this momentum.” — (c) 2012 NewsCentral Media