Nocom sells Network Innovation and breaks up distribution business area
Nocom has reached an agreement for the sale of Network Innovation to two senior executives in the company, Erik Näsman and Erik Pettersson. The sale will be carried out on September 30, 2007, and is conditional on the approval of the annual general meeting.
Network Innovation is a distributor of products for the professional graphics industry and has 19 employees in Sweden and Norway. In 2006 Network Innovation achieved net sales of SEK 90 million and a profit of around SEK 2 million.
As a result of the transaction, Network Innovation will be reported as a “discontinued operation held for sale”. The distribution business area consists of the subsidiaries Nocom Software and Nocom Drift, and now makes up a small part of the Group. The Distribution business area will be dissolved as of year-end 2007, after which the subsidiaries will be reported as separate units.
For the fiscal year 2006 the Nocom Group posted pro forma sales of approximately SEK 500 million and an operating profit of around SEK 62 million in continuing operations.
“With the sale of Network Innovation we have completed our realignment of the Group’s distribution business. The remaining distribution companies now account for around 10 percent of consolidated sales and are showing very strong profitability,” says Stefan Ström, President and CEO of Nocom. “In 2007 we have streamlined and strengthened our business while at the same time investing ambitiously to expand the range of proprietary products. The year’s divestitures and positive business development have further improved our financial position and will increase our opportunities to step up the rate of investment and make supplementary acquisitions,” adds Stefan Ström.
“In the past two years we have transformed the company from a distributor of third-party products to a focused sales organization with its own proprietary products. The motive for the change has been to come closer to the customers and own the products as a means for maximizing growth and profitability,” says Stefan Skarin, Chairman of Nocom.