Dicker Data announced that it would acquire the Exeed Group business operating across Australia and New Zealand. This transaction will propel Dicker Data NZ to become the second-largest IT distributor in New Zealand with estimated revenue of over NZD $500m for the combined entities.
Established in 2002, and headquartered in Auckland, Exeed is the second largest IT distributor in the New Zealand market and holds a dominant market share across a number of the vendors they represent.
With operations expanded into Australia in 2016, the Exeed business represents combined revenues of approx. NZD $380m, with FY21 full-year normalised EBITDA earnings expected to be approx. $15m. In addition to NZD $310m of revenue in the NZ market, this acquisition also gives Dicker Data access to NZD $70m revenue in Australia, across a vendor base that has no overlap with existing Australian vendors.
Exeed is a distributor of key technology brands including Apple, HP, Hewlett Packard Enterprise and Microsoft, with a focus on both the commercial and retail sectors. Exeed carries a number of exclusive distributorships in New Zealand including Motorola, Ruckus and Webroot.
The purchase price is $68m on a cash-free, debt-free basis, other than existing working capital debt which will be assumed by Dicker Data as part of the working capital balance at completion. The acquisition funding is supported by a cash advance facility from Westpac. There are a number of conditions to be satisfied for completion, however, Dicker Data expects to complete the transaction before the end of August 2021. The company also expects the transaction to be earnings accretive for the FY21 financial year.
Chairman and CEO, David Dicker, Dicker Data Limited said “After many attempts, over more years than I can count, we have finally got a deal done to acquire Exeed. This transaction will put us at a very strong number 2 in NZ, with a platform for number 1. The combined companies are highly synergistic. The deal done will be all cash. A very satisfying outcome.”