Tech Data To Close Brazilian Commercial Operations

"The closure is due to Brazil's complex tax, legal and regulatory environments which make it difficult for the company to generate a sufficient return on invested capital," the company said in a statement.

Tech Data will keep a legal entity in the country to handle its financial and legal responsibilities and look to serve Brazil customers through its export operations in Miami, according to the company.

"The decision to close our in-country operation in Brazil was a difficult one, but one we believe is in the best interests of our shareholders," said CEO Bob Dutkowsky in a statement. "Despite our team's best efforts, the complexities of operating in Brazil have prevented the Company from attaining the level of profitability needed to earn an adequate return on our investment."

Tech Data expects to report a loss between $22 million and $25 million in the fourth quarter due to charges surrounding the closure of the Brazilian operations. In addition, the distributor expects an impairment charge between $8 million and $10 million due to a currency exchange loss and another $8 million to $10 million charge to write off deferred tax assets in Brazil.

Tech Data is not the only distributor struggling in Brazil. In October, Ingram Micro cited losses in Brazil among $28.8 million in charges for its third fiscal quarter.