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Table of Contents
AVNET, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
and electronic document management products and services, with operations in six European countries and annual
revenues of approximately $200 million. Acal is reported as part of the TS EMEA reporting unit.
On October 8, 2007, the Company completed its acquisition of the European Enterprise Infrastructure division
of value-
added distributor Magirus Group. The division acquired is a distributor of servers, storage systems, software
and services of IBM and Hewlett-Packard to resellers in seven European countries and Dubai with annual revenues
of approximately $500 million. The acquisition is reported as part of the TS EMEA reporting unit.
In addition to the acquisitions mentioned above, the Company also acquired several smaller businesses during
fiscal 2008 as follows:
During fiscal 2008, the Company sold its equity investment in Calence LLC and received proceeds of
approximately $65,601,000 which resulted in a gain on sale of assets of $42,426,000 pre-tax, $25,924,000 after tax
and $0.17 per share on a diluted basis. In addition, the Company recorded a gain on sale of assets of $3,000,000 pre-
tax, $1,843,000 after tax and $0.01 per share on a diluted basis in connection with the receipt of the second and last
installment of contingent purchase price proceeds related to the fiscal 2006 sale of a TS business in the Americas.
Fiscal 2007
During the third quarter of fiscal 2007, the Company recorded a gain on the sale of assets in the amount of
$3,000,000 pre-tax, $1,814,000 after tax and $0.01 per share on a diluted basis related to the receipt of contingent
purchase price proceeds from the fiscal 2006 sale of a TS business in the Americas.
On December 31, 2006, the first day of Avnet’s third quarter of fiscal 2007, the Company completed the
acquisition of Access Distribution (“Access”), a leading value-added distributor of complex computing solutions,
which had sales of approximately $1.90 billion in calendar year 2006. The purchase price of $437,554,000 was
funded primarily with debt plus cash on hand and is subject to adjustment based upon the audited closing net book
value which has not been completed. As a result, the purchase price includes an estimate of the amount due to seller
based on the unaudited closing net book value. The Access business is reported as part of the TS Americas and
EMEA operations.
Allocation of Access purchase price
The Access acquisition is accounted for as a purchase business combination. Assets acquired and liabilities
assumed are recorded in the accompanying consolidated balance sheet at their estimated fair values as of
December 31, 2006. The allocation of purchase price to the assets acquired and liabilities assumed at the date of
acquisition is presented in the following table. This allocation is based upon valuations using management’s
estimates and assumptions. Management has evaluated the fair value of assets and liabilities acquired; however, the
Company has not received the audited closing balance sheet upon which, pursuant to the purchase agreement, the
final purchase price is to be based. As a result of this unusual circumstance, the Company will record the final
purchase price outside the typical one year purchase price allocation period.
In addition, the assets and liabilities in the following table include liabilities recorded for actions taken as a
result of plans to integrate the acquired operations into Avnet’s existing operations. The purchase accounting
adjustments include the following exit-related and fair value adjustments: (1) severance costs for Access workforce
reductions; (2) lease commitments for leased Access facilities that will no longer be used; (3) commitments related to
other contractual obligations that had no ongoing benefit to the combined business; (4) write-offs or write-downs in
the
52
Operating
Approximate
Acquired Business
Group
Region
Annual Revenue
Acquisition Date
Flint Distribution Ltd.
EM
EMEA
$
40 million
July 2007
Betronik GmbH
EM
EMEA
$
40 million
October 2007
ChannelWorx
TS
Asia/Pac
$
30 million
October 2007