Avnet Outbids Daetwyler for Raspberry Pi Maker Premier Farnell
July 28 2016 - 7:00AM
Dow Jones News
LONDON—U.S. electronics company Avnet Inc. agreed to buy Premier
Farnell PLC for £ 691 million ($907 million), trumping a previous
bid for the maker of the $5 Raspberry Pi computer.
Switzerland's Daetwyler Holding AG had last month agreed to buy
the British company for £ 615 million. Premier Farnell on Thursday
withdrew its recommendation of the Daetwyler offer.
Avnet said buying Premier Farnell would strengthen its digital
capabilities in areas such as offering services for design
engineering customers to do technical research online.
"This acquisition will significantly strengthen Avnet's digital
footprint world-wide," said Chief Executive Bill Amelio.
"The convergence of Premier Farnell's innovative online services
with Avnet's world-class supply chain will create customer service
unparalleled in the industry," he added.
Avnet offered to pay 185 pence a share for Premier Farnell, an
improvement on the 165 pence a share deal agreed with
Daetwyler.
A spokesperson for Daetwyler said the company is considering its
options.
Shares in Premier Farnell rose 17% to 192 pence in early trading
Thursday.
A deal between Avnet and Premier Farnell would combine two
companies that trace their history back to the interwar era as
wireless communications technology became more advanced.
Premier Farnell got its start in 1934, selling radio parts in a
Chicago store under the name Newark Electronics. It later merged
with A.C. Farnell Ltd. to become Premier Farnell, based in the
northern England city of Leeds.
Avnet began as a radio parts seller in Manhattan in 1921.
Premier Farnell built up a booming catalog business in the 1980s
and 1990s, selling cables, lighting products and other electrical
components to companies and hobbyists.
In recent years, though, its highest profile contract was to
build and distribute the Raspberry Pi—a cheap and tiny computer
designed by Raspberry Pi Foundation, a British nonprofit trying to
make computers more accessible. It released its first product in
2012 and now has four models.
The cheapest is the $5 Pi Zero, which made its debut last year.
The most expensive are the Pi 2 and Pi 3, both of which cost
$35.
The bare-bones device has garnered buzz around the world for its
price and what the foundation says is its potential to get children
hooked on computing and coding. Alphabet Inc.'s Google gave the
foundation a grant to provide 15,000 of its computers to U.K.
schoolchildren. Last month, Queen Elizabeth II knighted Raspberry
Pi creator Eden Upton.
The Raspberry Pi products look like credit-card-sized circuit
boards that the user can connect to a power supply, keyboard, mouse
and monitor or TV. They use the free Linux operating system. In
addition to making the devices themselves, Premier Farnell, one of
two licensed distributors of the Raspberry Pi products, has built
up a cottage industry selling accessories for them.
Premier Farnell reported £ 778.5 million in revenue for the
fiscal year ended January 2016. The division overseeing its
Raspberry Pi operations reported £ 125.4 million of that, or
16%.
Avnet reported revenue of $6.17 billion for the quarter ended
April 2.
Stu Woo contributed to this article.
Write to Rory Gallivan at rory.gallivan@wsj.com
(END) Dow Jones Newswires
July 28, 2016 06:45 ET (10:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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