TECH PACIFIC: Merged & Acquired

Midway through the year it was announced that Tech Pacific India, the largest
IT distributor in India, would merge with Ingram Micro India, following the
acquisition of Australia-based Tech Pacific by US-based Ingram Micro Inc. But
the merger came into effect only after March 31, 2005.

Tech Pacific continued on its growth path at nearly 27%, to close the year at
Rs 2,741 crore. The growth drivers were the systems business and the
value-driven enterprise business. The systems business grew 38% to net Rs 1,014
crore. Of this, Rs 795 crore came in from Intel-based systems comprising
desktops, notebooks, and servers. Unix-based systems and enterprise storage
products from HP and IBM constituted the rest.

HIGHLIGHTS India's top distributor merges into #3 Ingram to create a giant Good growth in systems business from Intel and component business from AMD Convergence products, geographic penetration, reseller finance schemes, enterprise products Enjoyed very good equity with leading vendors like HP, IBM, Sun, Samsung, AMD, among others Staid, lacks aggression and panache Exit of channel-savvy Ingram head SP Rajguru l Start-up Year: 1986 l Products & Services: Distributers for HP, IBM, Acer, Epson, Canon, APC, Iomega, 3Com, Cisco, Samsung, Microsoft, Adobe, Macromedia, Symantec, Palm, Sun, Oracle, Autodesk, and Avaya l Address: Gate 1A, Godrej Industries Premises, Off Eastern Express Highway, Vikhroli(E), Mumbai-400079 l Tel: 55960101 l Fax: 55960102 l Website: www.techpaconline.com

The systems market, specifically the PC market, ramped up quite a bit.
Interestingly, this was not achieved through MNC brands but from self and local
brands. Tech Pac deepened its penetration into the hinterland markets and gained
customers for PCs from HCL, and power systems from APC. Nearly 250 towns were
already being served; the market opportunity that was pursued was from areas
beyond these.

The 'value' division, dealing in enterprise products like servers, enterprise
software, and storage was the other sweet-spot for the year. Considering that
only 20% of the Unix market is channel-addressable, its contribution was good.
The company created distinct organizations to handle the security and storage
business to respond to increased demand from these categories. With these units
in place, the company invested in developing skill-sets, partner enablement and
partner training.

Tech Pacific had tried its hand at distribution of mobile handsets but it
proved to be a non-starter. It had to be content with brands like Siemens and
Panasonic, but Siemens exited the handsets business, and Panasonic volumes were
too low. The next target is to ramp up distribution of convergence products like
digicams and iPODs. During the year, the company developed new channels for
these products and reported reasonable volumes for HP digicams, Apple iPODs, and
Palm PDAs.

Many more initiatives were planned for the year but after September the
company had to put brakes on them. Next year, the company would get reported
under Ingram Micro.