M&A watch: Brazil's Positivo buys 80% of Accept

Brazilian electronics and computer manufacturer Positivo Tecnologia bought 80% of local firm Accept to expand its product portfolio, targeting principally the production of devices powered by artificial intelligence (AI), big data and cloud computing.

Founded in 1988, Accept manufactures and sells servers, desktops and mini PCs, as well as deep learning and AI solutions. The company has an office in São Paulo and a manufacturing unit in Ilhéus, in Bahia state.

"We will provide more complete solutions to our customers and engage in opportunities in cloud computing, big data and artificial intelligence," Positivo president Hélio Rotenberg said in a statement.

The value of the acquisition was not disclosed.

Under the terms of the agreement, the final price will depend on the achievement of certain performance targets by Accept.

Positivo will pay up to 50% of the earnings before taxes of Accept calculated annually between 2019 and 2023, with an aggregate amount limited to 51mn reais (US$13.4mn), monetarily restated, the company said.

Accept recorded revenues of 81mn reais (US$21mn) in the 12 months ending September 2018 and an annual average revenue growth of 25% in the last three fiscal years.

Positivo Tecnologia's sales grew to 490mn reais in Q3, from 437mn the year before.

Net income grew to 11.8mn reais, from 4.6mn, due to the pass-through US dollar prices as well as foreign exchange gains in the period, according to the company.

PC sales totaled 202,500 units in Q3 (+1.2%), as 66.5% of Positivo's Q3 revenues came from desktop and laptop sales and 25.8% from mobile phones, including smartphones and feature phones.

Positivo had its partnership with Huawei to sell the Chinese giant's smartphones in Brazil falling apart few months after being announced without any relevant achievement.