Even after the IPO, Platinum Equity will still control Ingram Micro with a stake of about 90 percent, according to regulatory filings.

Ingram Micro has set the terms for its initial public offering, targeting a valuation north of $5 billion with prices expected to be $20 to $23 a share.

The Irvine, Calif.-based IT distributor itself is offering 11.6 million shares of common stock, with private equity owner Platinum Equity selling 7 million shares, according to a statement by Ingram Micro Tuesday.

Even after the IPO, Platinum will still control Ingram Micro with a stake of about 90 percent, according to regulatory filings.

[RELATED: Ingram Micro Files For IPO; ‘INGM’ Share Price Undecided]

Ingram Micro Goes Public

CRN has reached out to Ingram Micro for comment.

At the midpoint of the proposed range, Ingram Micro would have a total market valuation of $5.1 billion, according to Renaissance Capital.

The distributor stands to raise as much as $427.8 million in the IPO. Bloomberg previously said Ingram Micro hoped for a $1 billion IPO and $10 billion valuation.

Morgan Stanley, Goldman Sachs and J.P. Morgan are among the banks underwriting the offering.

Ingram Micro reported that it had about 24,150 full-time employees as of June 29, about 4,970 of them in the U.S. The vendor acknowledged “a headcount reduction of 503 employees” in the first quarter of 2024 as part of a restructuring plan. “We currently do not anticipate material future costs to be incurred under this restructuring plan,” according to the regulatory filings.

Ingram Micro, which has applied to list under the ticker symbol “INGM” with the New York Stock Exchange (NYSE), will not receive any proceeds from stockholder share sales, according to the statement.

Ingram Micro, founded in 1979 as Micro D, plans to use net proceeds from the IPO to repay some of its term loan credit facility borrowings.

Platinum Equity has owned Ingram Micro since 2020, buying it from Chinese conglomerate HNA Group. In 2021, Ingram Micro sold some of its commerce and lifestyle services business to France-based CMA CGM Group in a deal valued at $3 billion.

As part of the potential risks to Ingram Micro’s business and industry, the vendor said that Tech Data and Synnex’s 2021 merger into TD Synnex made it “the industry’s largest IT distributor in the United States.”

“Further consolidation in our industry may be disruptive to our business in a number of ways, including, but not limited to, by affecting the availability and pricing of credit lines extended by our vendors and other capital suppliers to us, any reduction of price protection, stock rotation or similar vendor incentives, heightening pricing pressures and competition for customers and impacting our attractiveness to top talent,” according to the regulatory filings.

The vendor also touted its Xvantage digital platform launched in 2022 as a market differentiator. “We believe Ingram Micro Xvantage has already influenced, and will continue to influence, the acquisition and delivery of the full spectrum of technology solutions and services,” according to the filings. “By digitizing and automating quote-to-order, order status and tracking, customer service and other critical business support services, we are reducing transactional complexity and inefficiencies inherent in more manual processes and tools.”

Ingram Micro supports more than 200 cloud products and services, aggregates 29 marketplaces and manages over 36 million seats through its cloud marketplace. Its CloudBlue platform manages more than 52 million seats.

The vendor also pointed to the increased need for security, continued cloud growth, the rollout of broadband and 5G networks and the rise of artificial intelligence as key trends for its industry.

“For those distributors who are able to successfully execute the necessary shift to a digital platform, we expect AI to remove friction in the ordering process, improving and personalizing the customer experience by leveraging predictive models to generate insights and recommendations, and to power real-time dynamic pricing engines, accelerating the sales cycle and bolstering productivity,” according to the regulatory filing. “AI will increasingly drive a shift in the design and application of all types of technology, which is expected to drive accelerated demand for PCs, datacenter equipment, AI-enabled software, and many other applications.”