Ingram-Tech Pacific merger faces opposition

Zia Askari, New Delhi, Sep 13

With an aim to halt the process of merger between US-based distribution
powerhouse Ingram Micro and Australian firm Tech Pacific, Samsung Electronics
India has filed a case against Ingram Micro at the Bangalore High Court.

While the case has already been initiated, the Korean electronics major feels
that the merger of these two entities will not be in the best interest of the
'creditors'. “We are opposing the merger of Ingram with Tech Pacific in
the Bangalore High Court, because as a creditor of both the companies, we feel
that the merger will not be in the best interest of the creditors,” informed
Samsung's India spokesperson.

All other creditors who participated in the meeting held in Bangalore, as per the directions of the High Court of Karnataka, approved the scheme of amalgamation -K Jaishankar MD, Ingram Micro India

It is interesting to note that Ingram Micro acquired Tech Pacific for a
consideration of about $493 million in late 2004, however the merger process is
still going on and has already involved a lot of re-structuring for the merged
entity within India as well as globally.

Though full details of this Samsung-Ingram feud are not known, as the mater
is now sub judice, but sources close to the industry feel that it will not be
easy for Ingram to proceed further with its integration related to merger if the
court gives a ruling against it. 

On the other hand when contacted K Jaishankar, MD, Ingram Micro India,
informed that as per the directions of the High Court of Karnataka, an unsecured
creditors meeting was held in Bangalore recently in order to seek their approval
for the amalgamation of Ingram with Tech Pacific.

“This was being done as per the directions of the High Court of Karnataka
and Samsung was the sole dissenter. All other creditors who participated have
approved the scheme of amalgamation. This has been duly recorded and presented
to the high court and the matter is now pending approval from high court,” he
added.

According to industry experts Samsung has taken this step as part of its
right to object to a merger process in case the merged entity has any payment
related issues. “It is a normal process for any merger. In this case Samsung
might have big payment issues running into crores when it comes to Tech Pacific,
so obviously the company will move forward to object a merger for Tech Pacific
with Ingram,” added an industry source on conditions of anonymity.