Dicker Data chairman and chief executive officer, David Dicker, told ARN the deal was first brought to the table at last year’s ARN Judges’ Lunch.
“It’s a no-brainer – there is no product overlap and they were a bigger company than we are,” Dicker said. “If you look at all the companies that would have been possibly available, it is just about the only thing that is available and probably the best bet anyway.”
The acquisition includes both the Australian and New Zealand operations, as well as Express Online, and will see the brands merged under the Dicker Data brand “as quick as possible.”
The agreement involves the provision of financial assistances and this will require the approval of Dicker Data shareholders at an Extraordinary General Meeting which is expected to take place mid-March.
The deal is scheduled to complete on April 1, subject to “certain conditions being met.” and is fully funded by Westpac Banking Corporation.
Dicker said further decisions regarding operations will be made once the takeover is complete, although confirmed it will operate entirely out of Dicker Data's current Kurnell location.
In the meantime (and prior to April 1), Express Data will continue to operate as normal, according to Ross Cochrane.
He also said that moving forward, partners and resellers will be able to draw on a much bigger business with a broad range of products, while vendors will gain access to a highly-skilled, technical channel which is focused on the mid-market.
As far as logistics and staffing go, Cochrane said, "I don't how Dicker Data will manage the brand. What ever happens in the future, Dicker Data will make the decision and will have a strategy on staff numbers which they will share over time."
Express Data's parent, Dimension Data Holdings, said the decision to sell to Dicker Data is part of the company's strategy to sharpen its focus.
"While the resale of technology remains a core element of DiData's value proposition to clients, physical distribution is typically outsourced to specialist distributors," DiData CEO, Brett Dawson, said.
"Express Data... is our only distribution asset. The sale of the company follows our decision to exit the physical distribution market."
DiData confirmed Dicker Data will gain 350 employees, although Dicker said it is impossible to determine staff retention rates at this stage.
In a letter to resellers on the Dicker Data site, Dicker echoes everything he told ARN and stresses that the deal will put the company in a position to make its relationship with them "considerably broader and stronger".
Like all major deals the devil will be in the detail of the Dicker Data buy-out of Express Data, according to co-founder and director of Channel Dynamics, Cam Wayland.
Wayland said there are three basic reasons why one distributor acquires another: Vendor portfolio, people and skills, systems.
Recently, Dicker has been on a growth path signing distribution agreements with other vendors, in particular focusing on the software area, Wayland said.
They include Fujitsu, Tandberg Data, Schneider Electric SMB UPS, StorageCraft and Microsoft.
Wayland said what a potential buyer like Dicker would look for is a complimentary set up that further expands the company.
“Dicker’s biggest vendor is HP which is strong in storage and servers; Express Data is a big software company with a major partner in Cisco which fits very nicely,” he said.
“When it comes to people and skills that will be a challenge for the Express Data people. The culture and organisations are quite different. The business models are quite different."