French-based value-added distributor, Exclusive Networks Group, has bought a majority stake in Sydney-headquartered unified value distributor, WhiteGold Solutions, in the second major acquisition to rock the channel this year.
The deal comes nearly 12 years after WhiteGold was formed by husband and wife team, Dominic and Sharon Whitehand, and Jonathan Odria. While the two companies are not disclosing the value of the deal, Exclusive Networks Group (ENG) has taken a 70 per cent stake in WhiteGold Solutions while the three founders will continue to be shareholders - 10 per cent each - of the business in Australia.
WhiteGold Solutions CEO, Dominic Whitehand, said, “The company will be integrated as part of the Exclusive Networks brand. There will be an inevitable period of transition, which will see the WhiteGold Solutions name kept until further notice. The business will continue to operate as normal through the five WhiteGold Solutions offices in Sydney, Melbourne, Auckland, Brisbane and Perth.”
He expected the WhiteGold Solutions name to disappear early in 2015.
“The structure of the deal ensures both continuity and longevity, and underpins the aim and ambition of the management teams to build a large, sustainable VAD business that is customer centric and market challenging. Jonathan and Sharon continue in their current roles, with the rest of the team also continuing their previous roles and responsibilities,” Whitehand said.
He will also assume the role of Territory Manager for Exclusive Networks Asia-Pacific while Odria becomes Exclusive Networks Territory Sales Manager, Asia-Pacific.
No job losses
The good news for employees is there are no job losses planned.
“It is business as usual. We intend to invest in the business for future national and regional expansion, which will mean positive net recruitment, especially in customer facing and support roles. In fact, WhiteGold has nine open roles that are to be filled in the next six weeks in sales, product management, customer service, order administration, warehouse and junior systems management,” Whitehand said.
It is the Exclusive Networks Group’s first acquisition outside of Europe, the Middle East and Africa and signals its new long-term strategy to expand operations throughout Asia-Pacific.
Exclusive Networks Group CEO, Olivier Breittmayer, said in a statement, “This is a landmark moment in our international expansion that underlines our commitment to global vendor and reseller partners, and demonstrates our belief in the sustainability of our business model.
“Other distribution business models naturally dilute their ability to create value as they expand – ours does the opposite. WhiteGold Solutions is a very successful and well-managed business growing at around 60 per cent each year and ideally placed to become our gateway for expanding operations throughout the wider region.
“Its business is grounded in a remarkably familiar business philosophy, echoing many of the approaches to marketing and technical support that form our blueprint for true value-added distribution for disruptive technology vendors.”
His comments were echoed by Whitegold Solutions managing director, Dominic Whitehand, who said that the acquisition was fantastic news for partners and people associated with WhiteGold.
“We’re looking forward to playing our part in the next chapter of Exclusive Networks’ global expansion,” he said. “WhiteGold is extremely proud of our heritage in pioneering the unified value distribution model in A/NZ, and validating it with incredible success for our vendors and partners alike.
“In looking to expand both locally and into the wider APAC region, the business sought a partner that would give us stability, increased relevance with vendors and partners on a global scale, and continuing autonomy in managing and running our operation in A/NZ.”
The perfect fit
WhiteGold Solutions sales director, Jonathan Odria, added that in joining ENG, the company had achieved all of these goals through common vendors, partners and corporate philosophy.
“The cultural, professional and aspirational fit could not be better - and we are thrilled to have found such an opportunity to massively scale what we truly believe is the most effective, relevant distribution model available today,” he said.
So why did WhiteGold agree to partner with Exclusive Networks? According to Whitehand, WhiteGold wanted to continue operating in the “same disruptive, unique way without any change in corporate culture or local control.” ENG gave them this.
He said that all three founders had always said that they never wished to see the business fully acquired and integrated into an existing global player, as this would dissipate the value and impact of the unified value distribution model in the A/NZ market.
WhiteGold will continue to operate as it always has done and with full autonomy to continue executing the WhiteGold business mantra.
“Essentially, the only real change is that we are massively increasing our ability to scale, our influence and relationships with our vendors - and our value to our customers,” Whitehand said.
Large ICT market
Breittmayer said that another reason for the attractiveness of the Australian market was its disproportionately large ICT market by comparison to other industry sectors, and against similarly sized European economies.
“Australia and now New Zealand are among very few of the world’s developed economies to have shown growth during the global downturn, and IT is a major sector with IT spending forecast to reach 34 billion euros by 2016,” he said. “There is a significant opportunity for us to invest on behalf of our partners and become more influential in more markets.”
The move by Exclusive Networks Group reflects the manner in which it has grown its VAD business since 2003, first in Europe, then across EMEA and now globally. It is present in 22 countries outside of France.
Rather than assimilate geographic presence and corporate bureaucracy, the company claims to have remained genuinely committed to the entrepreneurial and dynamic attributes of the distribution businesses it has acquired.
In step with strong organic growth across the organisation, its long-running acquisition strategy of identifying ‘like-minded’ distribution businesses and encouraging them to grow as individual entities, is a core part of the Group’s plan to reach one billion euros ($A1.4bn) in global revenues by 2017.