The Dicker Data Ltd (ASX: DDR) share price has been a positive performer on Friday.
In afternoon trade the technology hardware, software, and cloud distributor’s shares are up 1.5% to $11.76.
This leaves the Dicker Data share price trading just a stone’s throw away from its record high of $11.96.
Why is the Dicker Data share price on the rise today?
Investors have been buying Dicker Data’s shares on Friday following the release of an announcement after lunch.
According to the release, the company has been appointed as the newest Australian distributor for industry-leading cloud, networking, digital workspace, and security vendor, VMware.
The release explains that this appointment was made following a mammoth 16-month global tender process.
“A significant source of growth.”
Dicker Data’s Chairman and Chief Executive Officer, David Dicker, believes the deal with VMware could be a key driver of growth for the company.
He commented: “This partnership will be a significant source of growth for our company in FY21 and unlocks not only the direct VMware business, but an entire ecosystem of solutions through the large number of VMware’s strategic and technology alliance vendors we already work with.”
“It’s exceptionally gratifying to see all the hard work our people put into this project rewarded with us beating out all our competitors to what is a pivotal vendor alliance. I look forward to reporting the positive impacts of our new partnership with VMware throughout FY21,” Mr Dicker added.
And while the company is unable to quantify the revenue impact the new distribution partnership will have at this stage, management appears to believe it could be material in the future.
Executive Director and Chief Operating Officer, Vlad Mitnovetski, explained: “The opportunity ahead of us with VMware cannot be understated. We believe VMware will rise to be one of our top vendors within a few short years of joining our business.”
“Access to the VMware portfolio cements Dicker Data’s position as the leading corporate and commercial distributor in the APAC region. The partnership will enable Dicker Data to offer a range of market leading technology products and solutions and builds confidence in our business amongst the wider market as we now represent all major tier-one technology brands and hold strong majority market share across our portfolio,” he concluded.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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