itX endorses Avnet takeover bid ahead of vote
- 21 October, 2010 17:42
IT software and hardware products distributor itX Group (ASX:ITX) has called a shareholder meeting for November 29 to vote on its proposed $77.5 million acquisition by Avnet.
The board has unanimously recommended that shareholders accept the $1.55 per share offer, which was first mooted in August.
itX received court approval yesterday to hold a vote on the acquisition offer, and dispatched a scheme booklet on the deal today.
Should shareholders clear the acquisition, the transaction will close on 4 January, 2011.
The itX board has only endorsed the offer in the absence of a superior proposal. According to the booklet, the arrangement is covered by certain exclusivity agreements, and the deal is subject to a break fee of $775,000 payable by either party if they call off the deal under certain circumstances.
itX has offices in every capital city but Darwin, and has distribution arrangements in place with Sun/Oracle, IBM, Citrix, VMware, HP, Apple, Red Hat and Trend Micro.
The company reported a 6.5% increase in FY10 profit to $7.6 million, from 9.1% higher revenue of $159.6 million.
Avnet is a global distributor of computer and electronic products and technology services, based in New York. The group earned $19.1 billion in revenue and $410 million in profit for the year ended July 3.
The company's Australian operations include a distribution business for enterprise servers, storage, networking, software and services. Separate groups distribute and market semiconductors and microprocessors.