Systemax Acquires Proteva PC Business

Systemax Acquires Proteva PC Business
Will Increase Systemax PC Run Rate to More Than $500 Million/Year

PORT WASHINGTON, NY, October 19, 1999 -- Systemax Inc. (NYSE: SYX) has acquired the assets, customer lists, name, and trademarks of the Proteva brand personal computer business. Proteva PCs (http://www.proteva.com(gone)) are best known for their impressive distribution through large national and regional mass merchandisers and consumer electronics chains. Customers include Sears (NYSE: S), Value America (NMS: VUSA), and The Wiz unit of Cablevision Systems (AMEX: CVC).

Richard Leeds, Systemax Chairman and CEO, said the acquisition is part of Systemax's highly successful strategy of creating a national PC brand on an economical basis by consolidating the largely unbranded "white box" market, which accounts for more than 50% of all PCs sold. Mr. Leeds said Proteva would become part of Systemax's existing domestic PC sales, assembly and service operation.

Proteva filed a bankruptcy petition under Chapter XI on August 30, 1999. Mr. Leeds said Systemax acquired the assets for an undisclosed amount of cash and the assumption of certain obligations. Proteva, which was established in 1988 and was privately held, is based in Posen, Illinois. In addition to Proteva's skilled work force, well known brand and current sales and distribution channels, Mr. Leeds stated that the purchase provides a number of additional strategic advantages:

Proteva's assembly operation has the capacity to produce more than 200,000 build to order PCs a year, significantly adding to Systemax's capacity to meet increasing demands.
Proteva has an experienced sales force serving retailers and value added resellers.
Proteva has been very successful at placing in-store kiosks where consumers can electronically purchase build to order PCs, eliminating the need for costly in-store inventory.

"Combined with Systemax's domestic PC operations, the Proteva assets will enable us to keep up with demand and further expand our penetration in the retail channel," said Mr. Leeds. "This will enhance our growing direct PC sales through the Internet and relationship marketing to the small office-home office and corporate markets. Systemax PCs are positioned as high quality value oriented products with the same name brand components and service as major name brand PCs, but at a significantly lower price. Next, our strategic plan calls for us to move into the government and education markets."

"The Company will announce results for the third quarter ended September 30, 1999 on October 28th.

About Systemax:

Systemax Inc. (www.systemax.com) has developed an integrated system of branded e-commerce web sites, direct mail catalogs, and relationship marketing to sell private label and name brand PC hardware, related computer products, and industrial products, to businesses in North America and Europe. With more than $1.5 billion in sales, Systemax is a Fortune 1000 Company that is listed on the NYSE and traded under the symbol SYX.