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October 13, 1998

CHS FACES LEGAL BATTLE AFTER PULLING OUT OF VOBIS DEAL

By CBR Staff Writer

A legal battle is expected to follow CHS Electronics Inc’s decision to pull out of the deal to pay around $320m for European last major PC maker and distributor, Vobis Microcomputer AG of Germany. Claudio Osorio, CHS chairman and CEO claimed that all conditions for the conclusion of the sales contract were not met by the Vobis parent company Metro AG. But in a statement Metro said: CHS was not in a position to pay the purchase price because of the poor conditions on the international capital markets. The collapse of the CHS share price from a peak of $30 last year, to a current level of $6.69 was considered to be a major factor undermining the deal. CHS will pursue all necessary measures to safeguard its legal position against Metro AG, said Osorio. Metro responded by saying it will pursue necessary measures to safeguard its legal position against CHS. According to Metro, it will take concrete steps to realize alternative scenarios with entrepreneurial perspectives for the Vobis Group. Vobis is still on the market and CHS rival Ingram Micro is favorite to move in.

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