Info. Technology - Regional

Avnet defining Latin America acquisition hunt on 3 criteria

Avnet defining Latin America acquisition hunt on 3 criteria

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US IT wholesaler Avnet Technology Solutions (NYSE: AVT) is basing its Latin American acquisition focus on geographic coverage, product lines and work culture synergies, Avnet's senior VP and general manager for Latin America and the Caribbean, Sergio Farache, told BNamericas.

Although unable to comment on specific conversations, Farache said Avnet's M&A focus is alive and kicking.

"Our acquisition strategy is one of the areas that continue to receive priority," he said. "We're actively analyzing potential buys. ... There are several companies in Latin America that are extremely interesting."

Inclusion of new types of hardware and software is at the crux of Avnet's overall solution development strategy in Latin America. "We want to continue to grow significantly in the area of software because software represents one of the most important solution drivers," he said. "On the other hand, we are making strides to increase our presence in the security, networking and communications markets."

Avnet recently solidified its relationship with Oracle (Nasdaq: ORCL) in Mexico, and also distributes the tech giant's complete product line in Brazil. Farache said the firms are exploring opportunities in other regional territories.

"We continue to explore growth and development options with Oracle," he said. "When both companies believe that the opportunity is right... we will continue to expand the relationship."

According to its website, Avnet has offices in Argentina, Brazil, Colombia, Chile, Ecuador, Mexico and Venezuela, meaning that potential geographic gaps in the company's regional coverage include Peru and Central America.

"Local market knowledge is an important variable," Farache said.

Globally, Avnet is also fine-tuning its leadership structure to facilitate future acquisitions. CEO Roy Vallee announced plans on Monday to step down from his post and oversee the company's merger and acquisition drive as executive chairman.

Vallee will be replaced by Rick Hamada, who has worked in Avnet since 1983 and most recently served as COO.

Avnet saw global net profits for its fiscal second quarter, ended January 1, rise 35.8% year-over-year to US$141mn, while sales during the same period advanced 40% to US$6.77bn.