Tuesday, 19 February 2008

Sadler quits Computacenter

I note that Ron Sadler quit the Chairman’s role at Computacenter yesterday “with immediate effect”. I’m sure I don’t need to tell you why but clearly he’ll be spending much of his time in Newcastle from now on. Perhaps he should join the board of Sage instead?

George O’Connor from Panmure Gordon said that the departure was ”good news” in his morning note. “Hopefully a new chairman with relevant sector expertise can drive the transition in Computercenter and inspire the CEO to be bolder in his aspirations. Mr Sandler moved too slowly, in our view”.

I’d certainly concur with that view. Computacenter has been one of those companies which says it knows what to do but just can never do it! For nearly a decade now we have been told that “PC distribution” is a dying trade and that Computacenter has to move up the value chain. But they seem to have great difficulty doing it. Reviewing what my (ex) colleague at Ovum, Kate Hanaghan, has written about Computacenter for that last few years, the headlines all seem to contain words like “tough”, “disappointing”, “poor growth in IT services” etc. The Digica acquisition, which took them further into managed services (a good move), has, at their own admission, not met their expectations. Indeed CEO Mike Norris said in their IMS a few weeks ago that Computacenter hadn’t had “a stellar year”. The only problem with that is that 2007 was a pretty good year for the market – certainly that will be how it will be observed after people review 2008! Norris says he hasn’t seen any effects of the downturn…yet.

Computacenter are now a member of the growing 50% Club – ie their shares are now less than 50% than their 2007 high. You may remember that Norris and the founders of Computacenter planned an MBO back at the end of 2005. The MBO price was rumoured to be 250p when the share price was 214p. Shareholders didn’t much like that.

Today, Computercenter trades at 162p…

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