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Systemax receives bid from German firm to buy its French operation

The Port Washington headquarters of Systemax.

The Port Washington headquarters of Systemax. Credit: Systemax

A German systems integrator has made an "irrevocable" bid to buy the French technology distribution arm of Port Washington-based Systemax Inc., the companies announced Wednesday.

Financial terms of the offer by technology systems integrator Bechtle AG were not disclosed. The Neckarsulm, Germany, company said in a news release that if the acquisition is completed, it would be the largest in Bechtle's history.

Systemax stock rose 3.8 percent to close Wednesday at $37.36, roughly double its price 12 months ago.

Brothers Richard Leeds, executive chairman, and vice chairmen Robert Leeds and Bruce Leeds together control almost 60 percent of Systemax stock, according to Bloomberg data.

Systemax's Inmac Wstore technology-products reseller business in France accounted for $143 million in sales in the quarter ended March 31. That was about 40 percent of the company's total sales of $355.2 million.

"We have been evaluating strategic alternatives for our Inmac Wstore business through a managed bidding process," Systemax chief executive Larry Reinhold said in a statement.

If the transaction is completed, he said, Systemax would be left with a North American business supplying industrial supplies, maintenance and repair.

Reinhold said proceeds from the deal "would provide Systemax with substantial additional liquid capital to invest in strategic acquisitions" and to return to shareholders.

Systemax launched operations in France 27 years ago.

Systemax said in a news release it has granted Bechtle "exclusivity for a limited period." Systemax said French law dictates that it must consult with the unit's works council before accepting or rejecting the offer. The consultation is expected to take up to several weeks, the company said.

Should Systemax accept the bid following the consultation, the parties would enter into a definitive agreement. At that point, the companies would disclose additional details, a Systemax spokesman said in an email.

The deal, if approved by French regulators, could close by the end of 2018, the spokesman said.

Systemax, formerly the owner of the CompUSA, Circuit City and TigerDirect brands, has recast itself as a seller of industrial equipment in the United States and Canada. 

Brothers Carl and Gilbert Fiorentino founded Miami-based TigerDirect and sold the company in 1995 to Systemax. They continued to run the company but were sentenced to multiyear prison terms in 2015 after admitting to a bribery scheme. 

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