AIMING to become a major player in the Australian distribution market, Provenco has forged ahead with its acquisitions and secured two further distributors.
The business technology supplier paid A$18.6 million for Melbourne-based Vantex and Christchurch-based Vantex Wholesale Distributors last month. Both companies distribute POS, barcoding, mobile and wireless computing products from vendors that include Epson, IBM, Netcomm and I-mate.
Provenco chief executive David Ritchie says the most recent acquisition positions the company as the region’s largest distributor of mobile, wireless and retail technology.
“This is a low-risk way of entering Australia. When we acquired Transtech Distributors 18 months ago it was just the start of the journey,” he says.
Provenco subsidiary Transtech has the Australasian distribution rights for Symbol scanning products.
In January Provenco purchased Sydney-based distributor Javelin Systems and Transtech appointed it as the Australian distributor of Symbol. Ritchie says this worked so well for Provenco that when the opportunity came to acquire Vantex the company jumped.
“We felt we wanted to acquire some well-run businesses and we will make sure we keep the factors that make them so successful. It’s all about efficiency and scale.”
He says Vantex provides a good fit with Provenco’s existing business and its scale and positioning in the Australian market is a good basis for growth.
The owners of both Vantex operations have been contracted for an undefined period and at this stage no redundancies are expected.
Ritchie says the four distributors will be run as one division under a general manager with centres in Sydney, Melbourne, Auckland and Christchurch. Vantex Christchurch will strengthen the existing Transtech business and provide a distribution and warehouse base for the South Island, he says.
The Provenco group has now established five divisions of business: payments, retail automation, supply chain technology, solutions and distribution.
Retail automation supplies the global retail oil industry and currently has 31 customers in 23 countries with a focus on supplying hardware and software.
A Beijing office was opened last year to expand into the wider Asian market and last November was awarded a supply contract with Shell worth $US9m.
Based on these successes and the recent acquisitions, the company has increased its operating profit projection for 2005 from $6m to $7.2m.