Ingram Micro (IM - Analyst Report) acquired an IT services company, Rollouts, to expand its offering in project management. The financial details of the deal have been kept under wraps.
Rollouts, along with its online project tracking tools and project management team, will be integrated into Ingram Micro’s Professional Services. The current acquisition will enable Ingram Micro to deploy specialized solutions for diversified sectors such as finance, retail, healthcare, public sector and education that will help its channel partners.
It is worth mentioning that Ingram Micro has resorted to acquisitions to expand its geographic reach and product portfolio. Moreover, certain acquisitions have given the company a strong foothold in the mid-range enterprise market.
Of the many acquisitions made by Ingram Micro, the most significant ones are Brightpoint, Inc., Aptec Holdings Ltd. and Promark Technology Inc. During 2013, Ingram Micro acquired SoftCom, CloudBlue and Shipwire which enhanced its products and services portfolio.
These acquisitions have expanded Ingram Micro’s presence in the high-margin products and services market that includes fee-for-service mobility device lifecycle solutions, traditional logistics solutions and cloud-based solutions. We believe that these acquisitions not only enhance the company’s offerings but also help it to garner additional revenues.
Moreover, an improving IT spending trend will help Ingram to post better results, in our view. Per a study by U.S. IT market research firm Gartner, global spending on IT could reach $3.7 trillion in 2014, a 2.1% increase from 2013. Ingram will likely benefit from this spending trend than others because it is the largest distributor of IT products, has a large scale of operations and geographical diversity.
Though Ingram Micro’s significant European exposure and a high debt burden are concerns, we remain optimistic about its strategic relationships with network giants such as Juniper Networks Inc. (JNPR - Analyst Report), Cisco (CSCO - Analyst Report) and International Business Machines Corp. (IBM - Analyst Report).
Currently, Ingram Micro carries a Zacks Rank #2 (Buy).