Report: Lenovo, IBM Resume Server Unit Buyout Talks
January 21, 2014 11:14 AM
comment(s) - last by
Analysts say deal is worth $2.5 to $3 billion
Sources that claim to be familiar with the negotiations are reporting that Lenovo has resumed talks to purchase IBM’s low-end x86 server unit. The move by Lenovo is seen as an attempt to branch out from the sagging computer market (to be fair, Lenovo has been
weathering the storm better than most
The two firms were in negotiations last year, but failed to come to an agreement on price. Reports last year during negotiations tipped that IBM wanted $4 billion to $6 billion for the server division. Lenovo was reportedly holding firm with a $2.5 billion offer.
Analysts are now expecting the sale to be in the $2.5 billion to $3 billion range.
"Everybody wins because even if IBM could double the profitability it's still not good enough for IBM. On the other hand, Lenovo doubling the server business margins is a good deal for Lenovo," said Alberto Moel, a Hong Kong-based analyst at Sanford C. Bernstein.
Neither IBM nor Lenovo have offered any official comments on the deal.
Lenovo could finance the deal with a combination of cash, debt, and converts according to analysts.
This article is over a month old, voting and posting comments is disabled
1/21/2014 4:04:08 PM
x86 is a low-margin market.
If you want another AS/400 though...there's only one place you can get one. And IBM makes a nice tidy profit off of each one.
Low-volume, high margin vs. high-volume, low margin.
It really makes little sense for IBM to even bother with the x86 market. They don't really have any value-add there. A Windows server is a Windows server. Leave that stuff to the fungible commodity OEMs like Dell and HP.
"We basically took a look at this situation and said, this is bullshit." -- Newegg Chief Legal Officer Lee Cheng's take on patent troll Soverain
Global PC Shipments Decline 6.9% in Q4 2013 says Gartner
January 10, 2014, 9:55 AM
How to Recover Most Apps After Your NVIDIA Driver Crashes in Windows 10
March 30, 2015, 12:54 PM
Tinkerer Gets Old School Mac Plus Running on the Modern Web
March 24, 2015, 6:41 PM
Facebook-Backed Oculus Rift's Release Date Slips to 2016; Valve and HTC Salivate
March 16, 2015, 5:58 PM
Hackers Steal Roughly $1 Billion From Banks Using Malware RAT
February 17, 2015, 9:30 AM
NVIDIA Kills Mobile GPU Overclocking, Robs Customers Who Paid For It
February 16, 2015, 8:59 AM
Apple Offers Refurbished 5K Retina iMacs for $2,119 Online
January 16, 2015, 12:37 PM
Most Popular Articles
WSJ Report Implies That Google Leveraged Lobbying to Kill Antitrust Abuse Probe
March 25, 2015, 5:37 PM
Food Chemists at Italy's Barilla Claim to Have Perfect Instant Noodles w/out Frying
March 26, 2015, 4:25 PM
Apple CEO's Pledge to Give Away His Fortune is Worth More Than Face Value
March 27, 2015, 5:08 PM
Church of Scientology Buys Twitter, Facebook Space to Attack HBO Documentary
March 30, 2015, 4:27 PM
Google Readies Gmail "Pony Express" to Combat Facebook's Messenger Payments
March 25, 2015, 11:43 AM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2015 DailyTech LLC. -
Terms, Conditions & Privacy Information