Comark, PC Wholesale Names Will Remain For Foreseeable Future

Comark PC Wholesale Insight Enterprises

Comark and PC Wholesale will become business units with their current names under the Insight umbrella, said Chuck Wolande, president and co-founder of Comark.

"For the foreseeable future it will remain. We have a lot of brand equity with our corporate customer base," Wolande said. "We will be known as 'Comark, an Insight company.' "

Insight agreed to purchase Comark for $100 million in cash and about 2.3 million shares of Insight stock worth another $50 million.

Comark, a $1.5 billion Bloomingdale, Ill.-based solution provider, serves mostly midsize and large customers. Insight's main focus is the SMB space, so the two companies should complement each other, executives said.

Insight reported income of $12.1 million, or 28 cents per share, on $528 million in sales for the first quarter ended March 31, compared with earnings of $14.3 million, or 34 cents per share, on $557.5 million in revenue for the year-ago quarter.

Insight has a virtual warehouse, shipping directly from manufacturers' facilities, while Comark has a large distribution center and integration center. Both models will continue, said Comark executives.

"When you combine, you get a best-of-breed inventory-type company and a best-of-breed virtual company," said Phil Corcoran, chairman and co-founder of Comark. "We'll have systems of choosing which way to ship product that are best for that particular order. We know we can shave some basis points off by bringing some orders into our distribution center. Not every order, but some that make sense."

Insight will continue to focus on the small business and lower end of the midrange space, while Comark will focus on enterprises and large midrange clients, said Stanley Laybourne, CTO at Tempe-based Insight.

The acquisition helps Insight compete against CDW Computer Centers, especially in the growing government sector, Laybourne said. "We have $100 million revenue in the government space, and Comark has $150 million," he said. "So now we'll get great coverage in this area as well as the worldwide market in general."

Insight's Comark business unit will be run by Tim McGrath as president. McGrath was previously in charge of all operations at Comark, said Laybourne. The company's new service arm, which includes elements from both Insight and Comark, will be named Insight Comark Services. It will be headed by two presidents: Mike Wise from Comark and Joel Borovay from Insight, he said.

The PC Wholesale business unit will be run by current PC Wholesale management, Laybourne said.

Corcoran and Chuck Wolande, Comark president and co-founder, have signed two-year deals for paid, nonoperational roles with Insight, Corcoran said.

"We'll be helping with the transition and making sure our people are taken care of," Corcoran said.

Comark was the subject of many acquisition rumors over the past couple of years, but Corcoran and Wolande decided Insight was the best fit after negotiations began earlier this year, Corcoran said.

"As you know, everybody is talking to everybody, especially since the slowdown and [vendors starting going direct," Corcoran said. "A lot of companies had an interest in Comark the last few years. Others tried to get us to buy them. Others wanted to merge. But there are a lot of companies not doing well, a lot that bring little to the table other than they were desperate.

"We've known [the Insight founders since the late 1980s, and our companies have a similar culture. The other thing that interested us is that they were similar with profit and revenue as us. It's nice to put together two large and profitable companies that can cover all aspects of the industry."

Shares of Insight closed at $25.16 Friday, up $4.13 per share, or 20 percent.