Mobile phone distributors confirm merger

Consolidation fever has spread to the Middle East mobile phone distribution market after Source IT and Link Retail Distribution revealed they will merge their operations to create one of the largest mobile-focused wholesalers in the Gulf region.

The tie-up will see Link Retail Distribution integrated into the Source IT group where it will bolster the company's product portfolio. Link Retail is the regional distributor for HTC mobile devices, while Source IT is renowned for its expertise in the Microsoft Windows-enabled PDA and smart phone category. The Dubai-based company stocks a variety of brands including i-mate, HP, Jabra and Krusell.

Source IT Group director, Ahmed Al-Azzawi, expects the merger to improve its standing within the Middle East retail channel by giving retailers a single source from which to purchase PDAs and smart phones. It will also allow the three-year old outfit to achieve stronger economies of scale.

"At Source IT, we are constantly thinking of the future, evolving our business to take advantage of market and channel opportunities," said Al-Azzawi. "As we grow, we need to continually look at further merger and acquisition opportunities, as well as signing possible regional alliances allowing us access to new markets and territories, which will help to create true values in our business."

Both parties claim the merger will break new grounds in the region by offering retailers the opportunity to purchase products for an entire category from a trade-only distributor. As a result, Source IT believes it is well-placed to offer a full category management solution to its partners including stock inventory controls and replenishment through to merchandising and support in sell-out activities.

Ahmed Ashraf, HTC brand general manager within Link Retail Distribution, added: "This merger will offer our combined people much greater opportunities to develop and grow with the business. The merger is a fantastic step forward for all. As a result, we have been able to amalgamate our back-office operations within the group, thus allowing us the opportunity to concentrate on developing and maintaining relationships, by providing a quality service to our customers," he concluded.

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