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Tech Data completes $6 billion sale to private equity firm

The Largo-based company has completed its sale to New York firm Apollo Global Management.

Tech Data is a public company no more.

After more than two years of bids and counter-bids, the Largo-based technology distribution company has finally closed its $6 billion sale to New York private equity firm Apollo Global Management.

“From a big picture perspective with Apollo,” Tech Data CEO Rich Hume said, “we’re really able to accelerate our future as opposed to deploying our vision on a bit of a different pace (as a public company).”

Apollo’s pursuit of Tech Data goes back to at least June 1, 2018, when the company made an initial offer of $105 to $110 per share, at a time when Tech Data was trading at $88 per share. Over the next 18 months, the offer per share went to $120, then $130, then — after a $140 bid from Warren Buffett’s Berkshire Hathaway — $145. Its final publicly traded share price was $144.90.

Related: No more rival bids for Tech Data, so $6 billion sale is on

At the same time it announced the completion of the sale, Tech Data announced plans to invest $750 million in digital transformation through 2025, including new digital business platforms and a cloud-based digital marketplace.

“We are going to take advantage of digital technologies in all aspects of our business,” Rich Hume said.

Founded in 1974, Tech Data sat at No. 90 on the Fortune 500 list of publicly traded U.S. companies, the highest ranking of any Tampa Bay company. It has more than 14,000 employees, including 2,000 in Pinellas County, and 125,000 clients in more than 100 countries. Sales in its last fiscal year totaled $37 billion.

The company’s shift from public to private, Hume said, allows Tech Data to “accelerate” its strategy to grow without being beholden to its shareholders. Part of that acceleration will come from the $750 million investment.

Tech Data plans to use part of the money on its “StreamOne” cloud platform, which helps companies “sell, manage and implement software and cloud services.” The funds also will go toward automating processes within the company that were previously done manually, and boosting its data and analytics to aid in decision-making.

“Data is the new currency of business, and one that we fully intend to exploit as part of our capability going forward,” Hume said.

To accomplish its goals, Tech Data expects to hire for a few highly specialized positions, which it will look for locally before looking elsewhere. Hume said the company expects to train any current employees as needed.

As far as the possibility of going public again some day, Hume said there are many possibilities for the company going forward, but that it is focusing on the “near term” with Apollo.

What won’t change yet are the company’s community commitments.

Tech Data was the title sponsor of the 2019 St. Pete Pride parade, partners with community nonprofits and encourages its employees to get involved in local volunteer work. Apollo, Hume said, is “absolutely clear” that Tech Data should maintain its corporate culture and presence in the local community.

“Tech Data has been in the community for greater than 40 years,” Hume said. “We intend on maintaining our community presence for a very, very long time.”

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