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Memec Acquisition
2005 Annual Report
2003 2004 2005
The July 5, 2005 acquisition
of Memec Group Holdings
Ltd. enhances Avnet’s
competitive position
in every region.
• Memec was known worldwide for its
strong demand creation focus.
• Memec had an excellent linecard with a
broad array of suppliers, some of which
are new to Avnet and will complement
the Company’s existing portfolio.
• With $2.3 billion in sales in calendar
year 2004, Memec will boost Avnet’s
components revenue to more than
$8.5 billion annually.
• Memec was the sole U.S.-based
electronics distributor with a formal
presence in Japan, the only major
market in Asia in which Avnet had
not yet established a physical presence.
With operations in 33 countries, Memec
was the largest semiconductor distributor
focused primarily on design chain services.
They built a unique business providing
engineering support to help original
equipment manufacturers evaluate
semiconductor devices early in the design
process. Memec’s ability to secure design
wins – to get proprietary products built
into manufacturers’ end products – was
also attractive to components suppliers.
The merger of Memec’s engineering
resources with Avnet’s design chain and
supply chain services creates a balanced
business model. Customers benefit from
an expanded supplier roster and additional
technical expertise backed by Avnet’s
global capabilities and resources.
Memec is being integrated into the Avnet
Electronics Marketing group. Less than a
month after the acquisition, the integration
of Memec’s inventory, information
technology systems, facilities and workforce
was largely complete in the Americas,
as was inventory consolidation in EMEA,
and the Company had closed more than
130,000 square feet of warehouse space.
Information technology systems in EMEA
and Asia should be integrated by the end
of calendar 2005, with the entire integration
complete by June 2006. Avnet is maintaining
the Memec warehouses in Japan and
Australia. Annualized synergy benefits are
expected to exceed $130 million worldwide.
All regions will have semiconductor-focused
Avnet Memec divisions. Although strategic
intricacies and supplier franchises may vary
as appropriate for each market, the Avnet
Memec divisions will continue to deliver
the world-class engineering services upon
which customers and suppliers rely.
Americas
44%
Asia
31%
EMEA
25%
011.52.0.5 2.5
$1.6
MEMEC
Sales by Region 2004
Sales
(in billions)
CY02
CY03
CY04 $2.3
$1.8
The acquisition of Memec opens the door
to the Japanese market for Avnet.
2005 – Avnet boasts
16 distribution,
programming and
value-added
centers globally
2005 – Avnet buys
Memec, its largest
and first global
acquisition
2004 – Avnet
programs 326,000
technology devices
per day, just one
of its many value-
added services
2005 – Avnet
outperforms 99.8%
of technology hardware
and equipment
companies in corporate
governance according
to Institutional
Shareholder Services
2003 – The technology
industry freefall comes
to an end; markets
stabilize
2003 – Avnet surpasses
$1 billion in sales in Asia