Report: Private equity firm wants to buy Tech Data for $5 billion

Apollo Global Management LLC has offered to buy Tech Data Corp., the largest company headquartered in the Tampa-St. Pete area, for nearly $5 billion, according to a report from Reuters.

Apollo offered about $130 for each share of Tech Data stock, Reuters said. That would be about 16.8 percent higher than Tech Data’s closing price of $111.34 a share at the end of the day Tuesday.

“In keeping with company policy, Tech Data does not provide comment on market rumors or speculation,” a spokesman for Tech Data said.

Tech Data (Nasdaq: TECD), based in Clearwater, is one of the world’s largest distributors of information technology. Tech Data buys products from companies such as Apple, HP and Cisco, and sells them to value-added resellers, direct marketers, retailers, corporate resellers and managed service providers. Tech Data posted $37.2 billion in sales in 2018 and employs 15,000 people, including more than 2,000 people locally.

Related story: How Tech Data stays ahead of the IT curve

Apollo is one of the leading alternative investment managers, with about $312 billion in assets under management. Apollo made an unsuccessful bid last year for a U.S. electronics distributor, Ingram Micro, for $7.5 billion, Reuters said.

While Tech Data has been working to improve its margins, they still are relatively slim An analyst on a recent conference call said Tech Data has one of the lower margin profiles in the industry. Private equity ownership could cause it to seek ways to cut costs and shore up its profitability, according to Channelnomics. However, that publication said, likely little will happen to Tech Data or its operations if acquired by Apollo or any other private equity firm — at least in the short run.

This is a developing story. The St. Pete Catalyst will add additional information as it becomes available.