DCC plc (LONDCC), the leading international sales, marketing and support services group, today announced that DCC Technology has acquired the Jam Group of Companies. Jam is a market-leading North American specialist sales, marketing and services business, serving the professional audio, musical instruments and consumer electronics product sectors.
Headquartered in Montreal, Canada, Jam is a world-leader in the professional audio and musical instruments sectors1, providing a range of industry-leading, value adding services and solutions to both its vendor and customer partners. This product sector and channel specialisation includes marketing and sales support, in-house technicians providing technical support, after-sales, repair and warranty repair services, in-house graphics and print services and the provision of white-label e-commerce platforms for smaller retailers and resellers. The business distributes in excess of 500 third party brands, with the majority of these relationships being exclusive, from leading vendors such as Allan & Heath, Focusrite, Harman, Incipio and Marshall and also develops and sells a range of complementary own-brand products. Jam sells to approximately 6,000 B2B and retail customers, including large retailers, e-tailers and specialist retailers and resellers across North America.
Jam is led by an experienced and proven management team, who will continue to manage the business following the acquisition. Jam’s operational footprint includes a Canadian sales office and national distribution centre, with a further national distribution centre and six sales offices across the US. The business recorded revenue of US$323 million in the year ended 30 April 2018 and employs approximately 570 people.
The acquisition of Jam is DCC Technology’s second acquisition in North America following the acquisition of Stampede in July 2018. The acquisition represents a further step in DCC Technology’s strategy to extend its geographic footprint and product range, strengthening its partnership with existing suppliers while also broadening its base of customers and suppliers. Importantly, the very strong service capability of Jam is consistent with DCC Technology’s increasing focus on positioning itself as a specialist service partner for customers and suppliers, providing extensive brand reach, market access and simplifying the complex supply chain of its chosen sectors.
The initial enterprise value of Jam is US$170 million (c. £130 million) and DCC expects the acquisition to be 4.5% EPS accretive2 from completion and to generate a return on capital employed of c. 15% in the first full year of ownership.
1 Addressable market is distribution only
2 Based on DCC’s financial year ended 31 March 2018
Donal Murphy, Chief Executive of DCC plc, said today:
“The acquisition of Jam significantly strengthens DCC Technology’s position in the North American market. DCC Technology now has approximately US$600 million in revenue in North America with a strong, service-led, specialist focus on professional audio and visual, musical instruments and consumer electronics. The growing and fragmented nature of these markets will provide DCC Technology with further opportunities for development in the coming years.”