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US based firm Avnet Inc. on agreement for the acquisition of all outstanding shares of Australian company itX Group Ltd::

American, Phoenix based company, Avnet Inc, Friday announced that it had reached a definitive agreement with Australian firm, itX group Ltd, for the acquisition of itX Group’s all outstanding shares. itX Group Ltd is an Australian value added distributor of software, hardware and services.

The deal will see the American firm pay A$77.5 million in an all cash agreement and the merger will be undertaken via a scheme of arrangement under Australian law. Even so, the acquisition is still subject to the approval of the Australian firm’s shareholders and other mandatory approvals under Australian investment laws.

However, itX board of directors has asked shareholders to vote in favour of the offer, seeing as it is that there is no better offer and analysts have given the deal the green light, terming it favourable, stated the company. The deal gives itX the right to declare and remit to its shareholders a special dividend of about A$10 million but under certain conditions.

As such, if itX declares and remits the special dividend to its shareholders, then the cash consideration for the merger is expected to be cut respectively. The deal is expected to be concluded in a period of 120 to 150 days and the business is expected to turn accretive to earnings immediately. Other than that, Avnet expects the deal will support its return on capital objectives for acquisitions.

The Australian firm, itX is a distributor of software, hardware and services from global software, hardware and services giants such as Oracle, IBM, HP, Apple, VMware, Citrix, Red Hat and Trend Micro. Other than the above, itX as well has Briell Marketing that is in the distribution of specialized printers and media for personal identification and security cards, medical and photographic imaging.

It also has Sydmed that distributes medical devices and ICO that offers IT hosting solutions. itX has 150 employees and has offices in Sydney, Melbourne, Brisbane, Perth, Canberra and Adelaide. Its profit for the financial year ended June 30th 2009 stood at about A$131.5 million.

Avnet, Inc. is one of the largest distributors of electronic components, computer products and embedded technology serving customers in more than 70 countries worldwide. Avnet accelerates its partners' success by connecting the world's leading technology suppliers with a broad base of more than 100,000 customers by providing cost-effective, value-added services and solutions.

15 Aug 2010.