Data Center

Smartlink Network Systems sells Digilink to Schneider

InformationWeek News Network, March 31, 2011

Smartlink Network Systems Ltd (SNSL) today announced that it is selling its Digilink Business to Schneider Electric India (Schneider) for Rs 5,030 million, under Business Transfer Agreement (BTA). The transaction would primarily include the transfer of the “Digilink” brand and trademarks, part of the manufacturing facility at Goa, the distribution network and employees who served Digilink. The company has agreed to a non-compete condition for a period of 5 years for the passive networking business.

Smartlink Network Systems Ltd (SNSL) today announced that it is selling its Digilink Business to Schneider Electric India (Schneider) for Rs 5,030 million, under Business Transfer Agreement (BTA).  The transaction would primarily include the transfer of the “Digilink” brand and trademarks, part of the manufacturing facility at Goa, the distribution network, and employees who served Digilink. The company has agreed to a non-compete condition for a period of 5 years for the passive networking business.
 
Digilink is SNSL’s passive networking arm that manufactures structured cabling solutions. This sale will enable SNSL to focus on its other businesses which are Digisol, catering to the active networking space and Digicare, its network of RMA/Service Centers and service partners across the country. Digicare also caters to companies like Gigabyte, MSI, IBM and HP (among others) for R&D.
 
KR NaikKR Naik, Executive Chairman, Smartlink said, “In the last two years we decided to focus more on active products. The Digisol business grew quickly in one year and we are now number two in this space with more than 100 (active networking) products. We will continue to focus strongly on the Digisol and Digicare businesses”
 
Naik said the sale Schneider includes two buildings in the manufacturing plant in Goa, and all the sales, service and marketing operations concerned with Digilink.
 
He did not give more details about the financial terms of the agreement with Schneider.
 
Responding to a question from InformationWeek during the press conference, Oliver Blum, Country President of Schneider India said, “Digilink has a huge spread in India with 3,000 retail outlets and we will benefit from this network. We will distribute some of Schneider’s products through this network.”
 
Schneider is looking to increase its share in the enterprise data center market. It already offers solutions for electrical distribution, low- and medium voltage, UPS and cooling systems (APC) and rack systems (APW President). It is also in the security business (it acquired video surveillance provider Pelco in 2007).
 
Blum said that network connectivity (structured cabling) will complete the Schneider portfolio to compete in the data center market in India.
 
Speaking to InformationWeek after the press conference, Manish Pant, Director – Strategy & Alliances, said Schneider will also take over the support for the existing customer base for Digilink’s passive networking products (structured cabling solutions).
 
It may be recalled that Smartlink demerged with D-Link India in 2009 and was renamed as Smartlink Network Systems Ltd. SNSL began manufacturing structured cabling products in 1999. It had earlier formed a JV with Sapphire UK (in 1995) for manufacturing and selling structured cabling solutions in India. The structured cabling business was rebranded as “Digilink” and re-launched in 2004.
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