Platinum Equity Nears $7 Billion Deal for HNA’s Ingram Micro

Manuel Baigorri, Bloomberg News

(Bloomberg) -- U.S. private equity firm Platinum Equity is nearing an agreement to buy HNA Group Co.’s Ingram Micro Inc. in a deal that values the technology provider at about $7 billion, including debt, according to people with knowledge of the matter.

Platinum and Chinese conglomerate HNA are hammering out the final details of a transaction that could be announced as soon as this week, the people said, asking not to be identified because the matter is private. Platinum has already lined up financing for the acquisition of Irvine, California-based Ingram Micro, the people said.

Talks are ongoing and either party could decide not to proceed with the sale, the people said. A representative for HNA declined to comment, while a representative for Platinum did not immediately respond to requests for comment.

A transaction would cap months of negotiations between the buyout fund and the Chinese conglomerate, which Bloomberg News first reported in August.

At $7 billion, the sale would be the biggest asset disposal by a Chinese company to a buyer outside the country in the year to date, according to data compiled by Bloomberg.

HNA Technology Co., the unit that holds Ingram Micro, said earlier this month in a filing to the Shanghai Stock Exchange that it is in talks with banks regarding the payment of $1.35 billion of loans that are past due. The company hasn’t paid off any of them, which are part of a $4 billion syndicated loan used to finance the acquisition of Ingram Micro in 2016 in an all-cash deal worth about $6 billion, the filing shows.

Ingram Micro, which traces its roots back to 1979, offers technology and supply chain services, according to its website. It operates in 59 countries and provides solutions in areas such as cloud, mobility and enterprise computing.

Once one of the most prominent Chinese acquirers, HNA began making a splash internationally in the middle of the last decade with deals purchasing everything from golf courses to hotels. In the past two years the debt-laden conglomerate shed billions in holdings across sectors such as real estate, and Chinese authorities announced in February that the company would be taken under government control.

Platinum is a Los Angeles-based buyout firm founded and run by Tom Gores, who is worth about $5.1 billion, according to the Bloomberg Billionaires Index. Ingram Micro would be among the largest-ever deals for the firm, which has about $23 billion of assets under management, according to its website.

(Updates HNA’s response in fourth paragraph.)