July 2, 2012
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of BrightPoint (Nasdaq: CELL ) soared a staggering 63% after technology distributing giant Ingram Micro (NYSE: IM ) offered to acquire the mobile phone distributor for about $650 million in cash.
So what: The deal values BrightPoint at $9 per share and represents a whopping 66% premium to its closing price on Friday. Ingram Micro is making the move to expand in the high-growth mobile space as the PC market continues to decline, and judging by its own stock's small gain today, Mr. Market seems pleased with the strategy.
Now what: Ingram Micro expects the deal to close next quarter and be "meaningfully accretive," with cost synergies of more than $55 million estimated by 2014. "Expanding our presence in the mobility market has been a focus of Ingram Micro and the acquisition of BrightPoint accomplishes this to an extent that would have been challenging to achieve on our own," Ingram Micro CEO Alain Monie said. So while BrightPoint shares are likely all popped out, Ingram Micro's new growth prospects might be worth looking into.
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