Systemax Inc. is shedding its “unprofitable” European Technology Products Group, a move that will free it to focus on its relatively profitable Industrial Products Group in North America and its I.T. services business in France, the company said today.
Systemax, No. 110 in the B2B E-Commerce 300, has agreed to sell its European Technology Products Group to a management team headed by Hilco Capital Limited. It did not disclose the terms of the deal, which closed today.
“In the past year we have significantly streamlined our company by exiting non-strategic and underperforming operations, positioning us to focus on our profitable and growing business segments,” Systemax CEO Larry Reinhold said today in announcing the sale of the European Technology Products Group. “IPG is a strong and growing business that has outperformed its industry sector in revenue growth for a number of years and has invested in substantial infrastructure to support future expansion. Our France business, which was our largest operation in Europe, is highly successful and has historically operated largely autonomously from our other European operations.”
IPG’s flagship site is GlobalIndustrial.com, which was named a finalist for the B2B E-Commerce Player of the Year award in last year’s Internet Retailer Excellence Awards program. The Player of the Year award category recognized companies with innovative B2B e-commerce sites that set examples for others to follow.
Although Systemax doesn’t break out e-commerce sales, it has noted that self-service e-commerce sales account for a large share of total revenue. It adds that nearly all sales, including those placed directly with sales reps, are supported in one way or another by e-commerce, such as when sales reps use the company’s websites to help customers research and place orders.
For the year ended Dec. 31, 2016, Systemax said sales at its Industrial Products Group increased 2.4% year over year to $715.6 million. Sales at its European Technology Products Group decreased 8.7% to $960.9 million, as consolidated corporate sales fell 9.4% to $1.68 billion.
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