Compaq Computer has agreed to pay $370 million in cash for the assets ofInacom, which custom builds PCs, as part of its ongoing push towards adirect sales model.
The move is all part of Compaq's recently announced plan to create a number of 'supply chain subcontractors', which sell PCs direct branded as Compaq. A tender is currently out to find a European subcontractor.
The PC supplier said the acquisition would help it compete more effectivelyagainst Dell by enabling it to sell more machines directly to customers. The Inacom acquisition will help it do this by providing it with the necessary skills to configure computers to customer requirements and to manage the entire ordering process from end to end.
Compaq currently builds most of its machines to its own factory specifications before shipping them to distributors and stores, while Dell builds its PCs to customer specifications.
Both Dataquest and IDC reported that Dell had moved into pole position in the US PC sector during the third quarter, while Compaq had slipped to the number two slot. Compaq remained number one on a worldwide basis, however, with a 13.8 per cent share of the market compared with Dell's 11.6 per cent slice.
Michael Capellas, Compaq's president and chief executive, said: "With this significant step, we are advancing Compaq's ability to deliver the leading portfolio of Internet access and infrastructure products and services directly to customers with a single point of accountability."
"This purchase makes great strategic sense for Compaq because it gives us the right capabilities quickly and cost effectively," he added.
Compaq now plans to set up a wholly owned direct sales subsidiary with endto end order management and complex configuration capabilities, while Inacomwill provide IT services.
The two companies have entered into a three year services, supply and salesagreement, which provides Inacom with access to the product customisationand logistics capabilities it is selling to Compaq. The deal is binding forboth parties and does not require shareholder approval.
Earlier this year Compaq made Inacom one of four Distributor Alliance Program partners and certified it as the first Compaq Channel Configuration Partner.
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