Lenovo buys German PC firm

Shanghai Daily, July 28, 2011

Lenovo Group Ltd, China's largest personal computer maker, will acquire a 36.66 percent stake from Medion AG for 13 euros a share via cash, the company said on Wednesday.

Lenovo Group Ltd on Wednesday said European authorities have approved its plan to acquire a German computer and consumer-electronics maker for 231 million euros (US$334 million) in a deal that could double the Chinese firm's market share in Germany.

China's largest personal computer maker will acquire a 36.66 percent stake from Medion AG for 13 euros a share via cash, it said on Wednesday. Lenovo, also the world's No. 4 PC maker, will extend the cash offer to remaining shareholders for 13 euros per share, which could cost the company another 235 million euros.

Lenovo said it is now discussing details of the deal, which is the company's second-biggest after it bought International Business Machines Corp's PC business, including Thinkpad laptops, for US$1.2 billion in 2005.

The purchase of Medion will boost Lenovo's share in both the PC and the mobile device markets, Lenovo Chief Executive Yang Yuanqing said earlier, adding that the firm remains open to further acquisitions. The tie-up will allow Lenovo to have more than 14 percent of the German PC market, from 7 percent now, and about 7.5 percent in west Europe.

According to researcher Gartner Inc, Lenovo lifted its global market share to 9.7 percent from 8.2 percent in the first quarter of this year.