Cellnet says the majority of its approximately 25 local staff work in the retail side of the business, rather than the IT distribution side now sold to Datastor.
Australian-based CEO Stuart Smith says a contingent of about six Auckland-based IT distribution staff will transfer to Datastor as a result of Cellnet’s exit from that aspect of its operations here.
Cellnet will now focus on the remaining parts of its business in New Zealand: telecommunications accessories, retail products and flash memory. Among the continuing agencies in this area are Navman, Belkin and Canon, Smith says. Cellnet also has Trans-Tasman master distribution agreements with iWorld, Siemens and Lexar.
The New Zealand business will retain its Auckland warehouse and office, Wellington office and salesperson in Christchurch, he says.
About two weeks ago it recruited a retail-focused staff member to bring local numbers to 25, says Smith.
In an announcement to the Australian Stock Exchange, Cellnet said the sale was effective immediately.
“The divestment of the IT operations in New Zealand is part of the strategy of the group to focus on its core competencies and invest in areas where the margins and return on working capital are improved,” it says. The statement adds the sale will free about A$1m of working capital for the Cellnet group, and have "negligible impact" on earnings.
Datastor CEO Dave Rosenberg says the sale will be a smooth transition, which is important for Cellnet’s customers, suppliers and staff.
Cellnet's IT business will begin operating as part of Datastor on Monday, while the rest of Cellnet will continue to trade, Rosenberg says.
Cellnet says Datastor will acquire the majority of the IT business’ staff and inventory. Rosenberg says he can’t comment until next week on which Cellnet staff, or how many, will join Datastor.
However, sales manager Peter Young has left Cellnet as part of a shift of IT sales management to Australia.
He says Cellnet’s IBM X-Series business is a strategic acquisition, as it was already offering IBM software and storage. “We’re now end to end IBM,” he says.
“We’ve made no secret if the right acquisition came along, we would take it. In my view this is a very positive and amicable transaction.”