PC giant Acer has finally exercised the option it has had since its acquisition of Gateway last year to buy European PC maker Packard Bell. The assumption that it has done so primarily to keep it out of the hands of rival Lenovo is reinforced by the fact that Acer only bought three quarters of the company.
Acer overtook Lenovo as the third largest PC maker in the world in 2007. Lenovo, having acquired IBM’s PC division in 2005, is traditionally strong in the Far East and the US, particularly in the corporate space. Lenovo has shown a desire to diversify into other markets and Packard Bell, which is essentially a European consumer PC brand, would have provided that immediately.
The move to acquire 75 per cent of Packard Bell’s parent company PB Holdings was announced by Acer to the Taiwanese stock exchange today. They will be paying $45.8 million for the privilege. Why it’s buying 75 per cent as opposed to all or just 51 per cent isn’t clear, but it’s difficult to see the business case for the acquisition outside of thwarting Lenovo with Acer already so strong in the European consumer PC market.
Coincidentally, or perhaps not, both Acer and Lenovo announced Q4 2007 financial news today. Acer UK claimed the fastest growth among the top three PC vendors (24.6 per cent year on year) and holds second place in the notebook sector with a 19.8% market share. Lenovo announced an incredible tripling of profits from Q4 2006, which led to a jump in its share price. It further streamlined its operations by selling its less successful mobile phone arm to private equity.