Bell Microproducts to Acquire the Computer Products Division of Almo Corporation.

SAN JOSE, Calif.--(BUSINESS WIRE)--Sept. 18, 1998--Bell Microproducts Inc. (NASDAQ:BELM), a leading value-added distributor and contract manufacturer of electronic products, today announced that it has signed a letter of intent to acquire the Computer Products Division of Philadelphia-based Almo Corporation.

Almo's Computer Products Division is a leading distributor of disk drives, monitors, Trademark(R) computers and additional products used by value-added resellers and systems integrators. The division also operates two facilities that manufacture private-labeled personal computers that are sold to value-added resellers. Revenue for the division in its fiscal year ended April 30, 1998 was approximately $146 million. Revenue for Bell Microproducts in calendar year 1997 was $533.7 million.

"Almo is an established, well-respected company that has been in business over 50 years," said Don Bell, president and chief executive officer of Bell Microproducts. "Its product line will complement ours, allowing our combined sales forces to sell a broader range of products to a significantly greater number of customers than either company has served in the past. They are particularly strong in the eastern United States, while we are particularly strong in the west."

"We are pleased that this acquisition is happening at a time when the company's results are so encouraging," continued Bell. "Based on third quarter performance to date, we expect overall revenues for the quarter to increase significantly over the record revenues of $144.7 million in the second quarter of 1998. Gross profits continue to grow, although not as rapidly as revenues, and we have successfully decreased operating expenses as a percentage of sales. As a result, net income per share is expected to be up more than 33 per cent over the $0.15 per share reported in the second quarter of 1998."

The acquisition is expected to be accounted for as a purchase using a combination of cash and a warrant to buy Bell Microproducts stock. Bell said it expects the acquisition to enhance earnings per share.

The acquisition is subject to final negotiation of the definitive agreements and satisfactory completion of due diligence. About Bell Microproducts Inc.

Bell Microproducts Inc. is a distributor of high technology products serving the industrial and commercial markets. The Company markets and distributes the products of more than 70 manufacturers of semiconductors, disk drives, tape drives, optical drives, computers, enhancement products and peripherals primarily to original equipment manufacturers (OEMs), value-added resellers (VARs) and system integrators nationwide. The company adds value to its products through a broad range of services including testing, kitting, mass storage subsystem assembly and the integration of complete computer systems. Bell Microproducts, through its Quadrus Division, operates an advanced contract manufacturing facility for printed circuit board assemblies and custom systems assembly.

More information on the company is available from the company's SEC filings or by contacting the company directly. Bell Microproducts' news and product/service information are available at World Wide Web site http://www.bellmicro.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Conclusion of the acquisition is subject to a number of risks and uncertainties including finalization of the definitive agreements and satisfactory completion of due diligence. Whether the acquisition is accretive to earnings will depend upon review of financial information of the Computer Products Division, and the retention of the management team will depend upon other things, on reaching satisfactory employment arrangements with this management group.