BUSINESS
Acer to buy Gateway
27-08-2007
by Emmet Ryan
Acer is set to overtake Lenovo and become the third largest PC vendor in the world with a USD710 million takeover of Gateway.
The move would leave only HP and Dell above the Taiwanese firm. Under terms of the agreement announced Monday, Acer will purchase all of Gateway's outstanding shares for USD1.90 per share. The deal has already been approved by the boards of directors at both companies and should be completed by the end of the year.
"This is the biggest acquisition in Acer's 30-year history," said J.T. Wang, Acer's chairman, speaking at a news conference in Taipei. "After this acquisition, we are solidly number three in the global PC market."
The deal is a double blow for Lenovo as its plans to acquire Packard Bell have seemingly been scuppered, with Gateway suggesting it will exercise its right of first refusal to acquire shares in Packard Bell's parent company, PB Holding Co. SARL, from John Hui. Hui is the founder of eMachines, a firm Gateway acquired in 2004, and the largest shareholder in Packard Bell.
Gateway was the world's eighth largest PC vendor during 2006 and together Acer and Gateway shipped 18.6 million PCs during 2006, compared to the 16.6 million PCs shipped by Lenovo. The acquisition will provide an immediate boost to Acer in the US where it currently lies in sixth place, while Gateway holds fourth position.
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