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Ingram Micro's Strategic Acquisitions Continue, Buys Ensim

Acquisition is one of the key strategies followed by Ingram Micro Inc. IM to enhance its geographical reach, expand its product portfolio and augment its supply chain capabilities. Recently, the company signed a definitive agreement to acquire privately traded company, Ensim Corporation, based in CA.

Founded in 1998, Ensim helps in the distribution of cloud applications (private, public, and hybrid clouds).  The company has more than 5,000,000 seats installed globally.  According to Ingram Micro, "This acquisition is an excellent complement to Ingram Micro and we look forward to Ensim joining our team."

The deal, subject to customary regulatory approval, is expected to be wrapped up within a month. The financial details of the transaction were kept undisclosed.

The acquisition is expected to help Ingram Micro expand its portfolio of service offerings.

On the other hand, Ensim will leverage Ingram Micro’s financial capabilities, brand value and global presence to help clients in diverse industries improve performance, reduce costs, leverage technology, address regulatory changes and stimulate growth.

Ingram Micro has gained a strong foothold in the mid-range enterprise market through various strategic acquisitions. Some of the significant ones are Anovo, Brightpoint, Aptec Holdings, Promark Technology, SoftCom, CloudBlue and Shipwire.

These buyouts have expanded the company’s presence in the high-margin products and services market including fee-for-service mobility device lifecycle solutions, traditional logistics solutions and cloud-based solutions. We believe that these takeovers have enabled the company to garner additional revenues.

Going forward, we remain fairly optimistic about Ingram Micro’s strategic relationship with network giants such as Juniper Networks Inc. JNPR and IBM IBM. The company’s growing exposure in the small and medium business (SMB) and improving profitability are encouraging. However, its significant European exposure and debt burden remain concerns.

Currently, Ingram has a Zacks Rank #3 (Hold).

Investors may consider a better-ranked technology stock, Lexmark International Inc. LXK, sporting a Zacks Rank #1 (Strong Buy).

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