Ingram Micro market cap up to $5.8bn after IPO as partners applaud public debut

'Now they can focus on managing the business rather than getting ready for a public offering. I expect them to continue supporting MSPs even better than before,’ says KME Systems

Shares of Ingram Micro soared by as much as 15 per cent in trading Thursday after once again going public, valuing the IT distribution giant at $5.82bn.

Even after the IPO, private equity firm Platinum Equity, which acquired Ingram in 2021, will still control the company with a stake of about 90 per cent, according to regulatory filings.

Ingram Micro started trading at $22 on the New York Stock Exchange under the ticker symbol "INGM" but the stock quickly ascended to $25.31 by around noon ET. Ingram Micro and Platinum Equity were expected to raise $409.2m in the IPO with 18.6 million shares offered up at a price of $22 a share.

Ingram Micro, founded in 1979 as Micro D, plans to use net proceeds from the IPO to repay some of its term loan credit facility borrowings.

Following a 2024 refinancing, as of September 20, 2024, $1.16bn was outstanding under the term loan credit facility and that all comes due in 2031, according to a regulatory filing.

“Reentering the public markets is a significant milestone for Ingram Micro, opening new avenues of growth for our customers,” said Ingram CEO Paul Bay in a prepared statement.

“As we remain committed to placing them at the heart of everything we do, we are well-positioned to drive innovation, expand our offerings and fuel growth across the IT channel.

“With the power of our AI-driven digital platform, Xvantage, we’re making it even easier to do business across the industry. We’re excited to continue investing in the success of our customers and vendor partners, helping them grow and thrive in this dynamic market.”

Partners cheered the IPO and said it makes way for new opportunities for Ingram and the channel as a whole.

“It’s super exciting,” James Rocker, CEO of New York-based MSP Nerds That Care, told CRN. “This IPO is a testament to Ingram Micro’s growth and success over the years. It feels like the perfect timing given where they are and where they’re headed. It’s the right move and the next step in their trajectory.”

The distributor reported that it had about 24,150 full-time employees as of June 29, with about 4,970 of them in the US. In 2021, Ingram Micro sold some of its commerce and lifestyle services business to France-based CMA CGM Group in a deal valued at $3bn. The company previously held an IPO in 1996 on the NYSE.

This new IPO is expected to enhance its presence within the MSP landscape with partners seeing the move as a catalyst for enhancing existing offerings and partnerships.

“Honestly, the support they provide is tremendous, almost overwhelming,” Rocker said. “With this IPO, I believe they’re going to deliver even more value to partners like us. The relationships we’ve built will only grow stronger with the company’s expanded global reach.”

And he believes the company’s services and support levels will only get better post-IPO, with advanced technologies and even greater financial resources.

“They talk the talk and they walk the walk,” he said. “They’ve always been on the cutting edge of innovation and growth and this IPO is going to propel both Ingram and its partners even further.”

He said the IPO signifies new opportunities for growth, both for Ingram Micro and its partners.

“I really believe that over the next two years, we’re going to see more companies come over to Ingram from competitors,” he said. “Ingram Micro’s IPO is going to enhance its position and those not already partnering with them might find themselves at a disadvantage.”

‘You don’t go public to not grow’

Kelly Carter believes the IPO will allow Ingram to invest even more in innovation that will move the channel forward.

“They’re very committed to the MSP community,” Carter, chief strategy officer at Fulcrum IT Partners, told CRN. “Ingram is always looking for ways to help MSPs become stronger and better positioned to compete with larger players. With this new capital, I believe they’ll keep investing in tools and services that help us stay competitive.”

With the IPO, partners hope the level of service and support will continue to improve as well as deeper vendor relationships. Carter said the channel has been “plagued by fragmentation,” but that Ingram Micro’s investments in technology will change that.

“Ingram is addressing a long-standing issue in the channel, the fragmentation between vendors, distributors and partners,” she said. “Their investments are going to make communication and operations more seamless, which will improve relationships and make the whole channel more efficient.”

Some partners also anticipate that Ingram’s public status will enhance their own ability to compete within the channel. By creating efficiencies and offering more advanced solutions, Ingram Micro is enabling solution providers to deliver better services at competitive prices, Carter said.

“This IPO gives us a leg up,” she said. “When Ingram brings efficiencies to our business, we can offer better services at better price points, which helps us stay competitive. Ingram has always been great at supporting cutting-edge ideas in the channel and this will only enhance that.”

Mark Essayian said the IPO allows Ingram to focus even more on its MSP clients.

“They’re out of that ‘grey zone’ of preparing for the IPO,” Essayian, president of KME Systems, told CRN. “Now they can focus on managing the business rather than getting ready for a public offering. I expect them to continue supporting MSPs even better than before.”

While the transition to a public company could bring additional scrutiny and pressure to meet quarterly earnings, he remains confident that Ingram Micro’s support and service for the MSP community will remain strong.

“I’m looking forward to seeing them bring new value and services that help me grow my business,” he said. “There are big investments needed in AI, sales, marketing and client support. Ingram’s got some really smart people and I expect them to continue driving the entire MSP community forward. You don’t go public to not grow.”

As the competitive landscape for MSPs may shift as a result of the IPO, one partner believes Ingram’s leadership could help partners navigate any changes.

“The partners that work well and tightly with Ingram might get ahead of the curve,” said Brent Morris, vice president of business development of Success Computer Consulting. “We look to Ingram for thought leadership, technology leadership and where the industry is going.”

Going forward, he hopes the IPO will bring more opportunities for collaboration, and his confidence remains high that Ingram will do just that.

“One thing Ingram has done really well in the two decades I’ve been at Success is bring the partner community together,” he said. “We thrive when we talk to each other, and Ingram has always provided a healthy, exciting, fun venue. I hope for more of that. They’ve always done a great job, and I don’t have any reason to think this changes their DNA, it’ll amplify it.”

Through artificial intelligence and machine learning, the Xvantage platform provides a personalised experience with data insight tailored to each of Ingram Micro's solution providers and their customers with real-time transactional benefits.

According to a recent regulatory filing, Ingram’s customer base includes over 161,000 companies ranging from value-added resellers, system integrators, telecommunications companies and MSPs.

“As one of the world’s largest technology distributors by revenue and/or by global footprint, we have positioned Ingram Micro as an integral link in the global technology value chain, providing technology solutions and services from more than 1,500 vendor partners to a broad array of customers,” said Ingram in its filing.

The company said it manages more than 850 million units of technology products across more than 220,000 unique SKUs every year and handles in excess of 12,000 technical engineering calls monthly.

Ingram said that it generated $48bn in net sales in 2023.

This article originally appeared on CRN UK sister website CRN. .