Arrow Acquires ALTIMATE - Analyst Blog


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Arrow Electronics Inc. ( ARW ) recently completed its previously announced acquisition of ALTIMATE Group (ALTIMATE).

ALTIMATE Group, a subsidiary of DCC plc, distributes enterprise and midrange computing products, services, and solutions in Europe. Powered by a network of approximately 2,500 value-added resellers and system integrators and employing 250 people, ALTIMATE generated revenues of $298 million.

ALTIMATE currently operates across eight countries including France, Benelux, Iberia, and the United Kingdom. The company holds a broad product portfolio of hardware, storage, data management, security, and infrastructure solutions and services.

Arrow expects the acquisition to broaden the company's portfolio of value-added services and enterprise solution offerings. In addition, the acquisition will also strengthen Arrow's relationships with important suppliers throughout Europe, Middle East and Asia.

In February 2012, Arrow Electronics acquired Asset Recovery Corporation intending to boost the company's North American market share along with diversifying its services portfolio.

Asset Recovery provides a wide range of electronics asset disposition (EAD) services and targets sales of $20 million in 2012.

Earlier, Arrow also acquired Texas-based TechTurn Ltd. Headquartered in Austin, Texas, TechTurn is an electronic asset disposition (EAD) services provider, which possesses a broad portfolio catering to technological recovery, refurbishing and remarketing services which they globally offer, primarily to major Fortune 500 companies.

The acquisition appears to be a profitable one as TechTurn has been yielding favorable results of late with revenues expected to exceed approximately $50 million in 2012.

After Beijing-based Seed International Ltd., TechTurn is the next major acquisition executed by Arrow in recent times.

Companies like Arrow will have to continuously broaden its product portfolio through acquisitions in order to retain its position in the global market.

We continue to maintain a Neutral recommendation on Arrow. However, we have a Zacks #4 Rank on the stock that translates into a short-term rating of Sell due to the uncertain economic environment, which shall adversely impact revenues.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
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