BUSINESS
Lenovo eyes up Packard Bell
08-08-2007
by Ciara O'Brien
PC maker Lenovo has Packard Bell in its sights as a possible takeover target, in a deal that reports say could be worth up to USD800 million.
The Chinese PC manufacturer, which took over IBM's notebook and PC business in 2005, is seeking to reinforce its European business. Lenovo has confirmed that it is eyeing up the Dutch PC maker.
"The company is currently continuing negotiation with the independent third party and undertaking certain necessary enquiries with third parties and/or government bodies in preparation for the entering into of definitive agreements for such proposed acquisition," Lenovo said in a statement.
Meanwhile, Packard Bell is reported to have put to rest any rumours of a bidding war between Lenovo and rival Acer for the Dutch firm, which John Hui purchased from NEC in 2006, confirming the talks were exclusive.
Lenovo, which is currently third in the global ranking of personal computer manufacturers, is hoping to grab Packard Bell, and with it market share in Europe, where it is languishing at sixth in the manufacturer tables. Packard Bell, meanwhile, has a 2 percent share of the global PC market, which puts it in ninth position according to analyst firm IDC. The Dutch firm claims it is in third position in the European PC market; although analyst figures have shown it swapping between third, fourth and fifth place for the past year.
The Chinese PC maker has heavy competition in Europe, with Dell, HP and Acer all vying for increased market share. Lenovo is hoping that this acquisition as well as a move into the consumer market will help boost its market share in the region. The firm, which traditionally focused on the business market, is planning a new range of consumer notebooks slated for release in January, with desktops to follow a few months later.
Lenovo has had a major battle for global market share on its hands in recent months. It reclaimed its third-place crown from Acer in the second quarter after research from Gartner and IDC showed it had slipped to fourth place in the first three months of 2007.
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