Gateway Inc yesterday announced plans to acquire European PC
vendor Packard Bell BV, a move funded by Taiwan's Acer Inc to fight
its rival Lenovo in Europe.
US PC maker Gateway yesterday said it offered to buy the parent
of Packard Bell BV for an undisclosed amount and the deal is
expected to be firmed up by late 2007 or early 2008. It said Acer
Inc had agreed to finance the bid.
The proposed deal, which comes weeks after Acer announced that
it would acquire Gateway for $710 million, would keep Packard Bell
out of reach for Lenovo, which has been in talks with Packard Bell
for an acquisition bid to boost its European business.
Lenovo faced its first hurdle last month when Gateway said it
intended to exercise its right of first refusal to acquire all
shares in Packard Bell's holding company from John Hui, a Hong
Kong-born entrepreneur who also holds shares in Gateway.
Lenovo's chief executive Bill Amelio said late last month that
it was "still very interested" in the company. "Packard Bell is a
great fit. It's not over until it's over," he had said in Beijing.
But he added Lenovo had "plans in Europe (even) without Packard
Bell".
Acer and Lenovo have been fighting for the third place in the
global PC industry, behind market leader Hewlett-Packard and
Dell.
Lenovo has risen to the No 3 position by taking over IBM's PC
arm for $1.75 billion two years ago. But the sales volume gap
between Lenovo and Acer is still narrow, with total shipment in the
second quarter reaching 4.8 million and 4.3 million respectively,
according to IDC.
IDC said if Acer's deal with Gateway goes through, the Taiwanese
PC maker will become the world's third-largest player replacing
Lenovo in terms of shipments.
Although it is still unclear whether Acer would successfully
trim its business after acquiring Gateway and Packard Bell, experts
said the move would give Acer an edge in the world PC market, where
advantage of scale is vital.
"The discrepancy among products of different PC vendors is
becoming insignificant and large manufacturers have to gobble up
smaller ones to establish advantages of scale," said Simon Ye,
analyst from research house Gartner. "Though Acer may face many
obstacles in consolidating the new companies, acquisition is the
way to go."
(China Daily October 10, 2007)
