ScanSource Inc. (Nasdaq: SCSC) is buying Brazil-based Network1, a communications equipment provider, for $70 million to expand in Latin America.
Network1, headquartered in Sao Paulo, does business as Network1 Intersmart Comércio Importação Exportação de Equipamentos Eletrônicos SA. The company distributes various services, including networking, data center, cloud, security, infrastructure and other services. The deal also includes potential earnout payments based on Ebitda over the next four years.
In addition to operations in Brazil, ScanSource is buying other assets in Latin America, including those in Mexico, Colombia, Chile and Peru. The buyer, headquartered in Greenville, South Carolina, distributes specialty technology products and services, including automatic identification and data capture and point-of-sale devices.
Dealmakers are expecting M&A in the technology, media and telecommunications sector to gain more quickly than the overall market, according to Mergers & Acquisitions Mid-Market Pulse.
Buyers have been looking to acquire middle-market companies in emerging markets, including Latin America. For more, see "5 Buyers Find New Customers Abroad." For more on dealmaking in Latin America, see "Advisers Ramp Up Latin America Teams."