How David Dicker plotted a billion-dollar distie

DiData departs distribution

The advantages to Dicker Data go beyond the lack of vendor double-up, said Ross Cochrane, former CEO fo Express Data and now an executive of the global Dimension Data Group.

"If you look at the technology pillars that are addressed, Dicker Data is best known in the server, desktop, notebook and peripheral environment, while Express Data comes from a background of networking, security, data centre, communications and collaboration infrastructure, and software licensing and cloud."

Furthermore, Dicker Data is strong in SMB, while Express Data has a bigger presence in the enterprise space.

Cochrane told CRN that the prefered supplier arrangement between DiData and Express Data would remain in place under the new ownership.

He explained that the sale of Express Data fits with DiData's wider transformation as a services and cloud provider.

Express Data was the $5.8 billion integrator's only distribution business anywhere in the world.

"Over some years, there has been a focus from DiData on managed services. They have been investing heavily in that space, such as the NextiraOne acquisition in Europe last week, with 4,500 staff in managed services.

He also pointed to DiData's acquisition of Australian cloud player BlueFire and US-based Opsource.

In its most recent financial results lodged with ASIC, Express Data saw an 8 percent fall in sales and a 72.8 percent fall in income – signs, perhaps, that its focus was elsewhere.

Cochrane agreed that Express Data was not core to DiData's strategy around managed services and cloud, the two areas where the money is being spent.

"Express Data was only represented in Australia & New Zealand and, therefore, not a global business for DiData. As you pursue a strategy, you invest more and more around that strategy so it becomes harder to put investment and focus into things that are not aligned with that," he said.

As a distributor owned by an integrator, Express Data has always had to work against a perceived conflict from some quarters of the industry.

"We have operated as both an SI and a wholesale business for about 18 years and they have been operated at arm's length with separate systems and facilities. However, there are people who would perceive there could be a reluctance by certain integrators to compete with Dimension Data on one hand, then have an entity like Express Data that was owned by that competitor.

"This [deal] will remove that completely. It will be very clear: DiData in the integration, cloud services, managed services business and Dicker will be a standalone, separately owned entity, Australian-owned, Australian-listed IT solutions distribution specialist," said Cochrane.