Datalink Acquired For $258M

The companies said the merger would help it better compete in a complex IT environment.

Datalink Corp. said Monday that it agreed to be acquired by an Arizona-based firm in a deal valued at $258 million.
Insight Enterprises, an IT services firm, said the deal will strengthen its data-center capabilities amid an environment that is increasingly competitive and complex. The company agreed to pay $11.25 per share for Datalink, a nearly 20 percent premium on Friday’s closing price.
“The acquisition of Datalink is a significant step in strengthening the foundation of our data center practice as we add the expertise and depth of the Datalink team to our portfolio,” Insight CEO Ken Lamneck said in a statement.
Both companies offer IT services to some of the nation’s largest firms, as well as the public sector. Combining allows the two to offer more end-to-end service.
“The strength of Datalink’s world-class data center capabilities combined with Insight’s scale and breadth of offerings will bolster our ability to deliver solutions for complex business problems across an expanded footprint of clients,” Datalink COO Shawn O’Grady said.
 The deal is likely to result in some layoffs, as Insight said the deal could achieve $20 million in cost savings within two years due to “corporate efficiencies, duplicative functions and IT system integration.” The company expects it to be accretive to earnings in 2017 after accounting for transaction and integration expenses.