Synnex Beefs Up Canadian Presence With EMJ Data Systems

Officials of the two distributors said this week Synnex, through its Canadian subsidiary Synnex Canada, has agreed to acquire EMJ Data Systems in an all-cash deal worth U.S. $42.3 million, or $56 million Canadian. The deal is expected to close within 90 days, although EMJ could cancel the deal should a better bid be offered.

Based in Guelph, Ontario, EMJ specializes in products for Apple, bar coding, auto-ID, POS, build-to-order, digital video, networking, and security applications. It has offices in Vancouver, Calgary, Winnipeg, Montreal, and Halifax, as well as in Pittsboro, N.C.

The move is highly synergistic, said Jim Estill, president and CEO of EMJ. "Synnex has a great low-cost engine that we can take advantage of," he said. "They also are looking to build volume in niche markets like bar codes, auto-ID, and Apple."

Once the deal closes, Synnex will expand EMJ's presence in the United States as it works to boost sales in the POS, auto-ID, and bar code markets, said Estill.

That will put EMJ in direct competition with ScanSource, a leading specialty distributor with a strong focus in the auto-ID and POS space, said Estill. Officials of Greenville, S.C.-based ScanSource declined to comment on the acquisition, citing a policy of not discussing competitors' business.

Dennis Polk, CFO and senior vice president of corporate finance at Synnex, said Synnex wants to acquire EMJ for two reasons. First is the high esteem the Canadian market has for the company and Estill. Second, the acquisition brings Synnex into the auto-ID and POS market, in which Synnex has no significant presence.

Estill said Synnex plans to keep the EMJ name. He is expected to become CEO of Synnex Canada, a position that is currently unfilled.

Synnex Canada currently accounts for 10 percent to 12 percent of Synnex's overall revenue, Polk said.