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19 Sep 2016 By Jennifer Saba Follow @jennifersaba

In buying a unit of Avnet for $2.6 bln, Tech Data trots out gobbledygook such as “hyper-converged infrastructure” and “value-added distribution.” At least sorting through the numbers is easier. Cost savings should help the acquisition deliver a healthy return on investment.

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Tech Data said on Sept. 19 it has agreed to acquire Avnet's so-called technology-solutions business for $2.4 billion in cash and about $200 million in stock. Under the terms of the deal, Avnet will own about 7 percent of Tech Data.

An expected $100 million of annual cost savings will be achieved within two years of the deal closing, Tech Data said. There also should be $200 million in present value of tax benefits.

Tech Data is a global IT distributor with a market value of $2.5 billion. Avnet's Technology Solutions business offers data-center services. Avnet's market value is worth $5 billion.

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