Cellnet sells up its NZ IT distribution business

New Zealand based distributor, Datastor has bought Cellnet's IT distribution business.

Details of the sale are confidential, however Stuart Smith, CEO at Cellnet said the sale of the sales segment will release one million dollars in working capital for the local distie.

In a statement to the ASX, Smith said the sale would have a "negligible impact on earnings for the Group".

"The majority of the IT distribution staff and inventory will be acquired by Datastor," he stated.

"The fact that the majority of staff will be offered alternative immediate employment is very positive in the current economic climate."

The divestment of the division in NZ is part of a strategy by the group to focus on its core competencies and invest in areas "where the margins and return on working capital employed are improved."

"The continued development of the retail segment of the business continues with the recent appointment of additional brands including master distribution agreements in NZ and Australia for Siemens and iWorld as well as the addition of Lexar," Smith stated.

"The recent roll out of new accessory packaging for the telecom channel is also part of the continued investment in this segment."

The distributor indicated in the statement, the future of the Australian IT operations are under discussion with IBM with a "view to a sale and further information will be released as it becomes available".