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Distributor SYNNEX Corp. said this week it has closed the first round of its acquisition of IBM’s CRM business.
The transaction is closing in stages because it covers markets around the world; each of those regions has its own legal and regulatory considerations for M&A, which means approvals come in waves. SYNNEX would not say which geographies are affected by the initial closing, only that more details will be announced in the company’s April 9 earnings call.
SYNNEX last September snapped up IBM’s customer services business for $505 million and will integrate those operations into its Concentrix call center subsidiary. Concentrix now stands as one of the largest brands in the call center market.
The buy “elevates the previously Tier 2 player into one of the top players in the industry, and we expect it to make quite a bit of noise given IBMs history, capabilities and client base that Concentrix is picking up,” Margaret Goldberg, IT services analyst at research firm Ovum, said last year.
In addition, Goldberg said, SYNNEX now picks up IBM as a major alliance partner; that’s because SYNNEX, a distributor, and IBM announced a multiyear strategic business partnership where SYNNEX will provide global call center services for IBM.
“This transaction illustrates the continuous effort of CRM vendors to diversify, as the acquisition will help Concentrix increase the depth and breadth of its offering including capitalizing on technology trends from mobility to cloud systems to analytics,” Goldberg said.
When the IBM purchase is fully wrapped, SYNNEX will serve clients in 10 vertical markets and employ more than 43,000 people in more than 36 countries. Meantime, Christopher Caldwell has been promoted to executive vice president and president of Concentrix Corp., leading the combined organization.
The Concentrix-IBM deal gives SYNNEX distributors transitioning their revenue bases from up-front compensation to recurring revenue yet another option for achieving that goal.