December 08, 2004

IBM Sells PC Division to Lenovo for $1.25B

IBM is ditching their PC hardware business for $1.25B to Chinese PC manufacturer, Lenovo. The company plans on focusing on their higher margin businesses, software and services. Lenovo will pay IBM $650M in cash, $500M in debt, and $600M in stock. IBM will still hold a 18.9% position in the combined company, which will become the third largest PC company in the world. Already Michael Dell is laughing at the deal citing that no merger in his industry has been successful in the long run. By golly, he is right.