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Ingram Micro set for $6bn sale to Chinese enormo-corp HNA Group

US Committee on Foreign Investment to investigate deal

The world's largest tech distributor, Ingram Micro, is set to be acquired by the Chinese conglomerate HNA Group for approximately $6bn.

Ingram Micro has announced that it has accepted the terms of a merger agreement with Chinese shipping company, Tianjin Tianhai, and will become part of the Chinese mega-firm HNA Group – an aviation, tourism, and logistics magnate.

According to its website, HNA Group has 11 listed companies, assets of $90bn, annual revenues of nearly RMB 190 billion ($29 billion, £20.4bn) and employs nearly 180,000 staffers worldwide.

The deal is yet to be confirmed, however. Due to the size of Ingram Micro - $45bn plus in annual sales - it is subject to an investigation by the US Committee on Foreign Investment in the United States (CFIUS), which exists to review the national security implications of foreign investments in American businesses.

Reuters reported that the Tianjin Tianhai will be required to pay Ingram $400m if the deal is cancelled following the CFIUS review.

The acquisition sees the Chinese company slurp Ingram Micro for $38.90 per share, in an all-cash deal estimated to be worth $6bn. Ingram is holding back its quarterly dividend payment and its share repurchase programme prior to the transaction closing.

HNA Group, a private conglomerate, is seeking to extend its geographical reach and embiggen its logistics arm with Ingram Micro's supply chain network.

Adam Tan, chairman and CEO at HNA Group, said the buy will “facilitate the internationalisation process of the group”. i.e - world domination.

HNA said Ingram Micro will continue to be headquartered in California and the exec management team will remain in place, as will all the current lines of business and regional country ops.

Alain Monié, Ingram Micro's CEO, said the move would deliver the company a "strong presence in China that can further support the growth and profitability of our vendor and customer partners."

Ingram Micro, whose 2015 Q4 results are due on 25 February, has taken bigger strides - or made more noise - than most rivals in rolling out cloud aggregation services and recently acquired a hosting and cloud service management system from Parallels. In theory, HNA gives Ingram even deeper pockets with which to expand via such investments.

The channel is still digesting the significance of the buy, but smart trade customers of Ingram will be out there renegotiating their current buying contracts, and a couple told us that’s exactly what they’ll do.®

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