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Acer-Gateway deal is valued at $710 million USD

There is big news out of the computer world today. Acer today announced that it has reached a definitive agreement to purchase U.S.-based Gateway, Inc. Gateway is currently ranked as the fourth largest PC manufacturer in the U.S. with shipments of over 20 million PCs per year.

The acquisition is estimated to be valued at $710 million USD ($1.90 per share) and is expected to be finalized in December 2007.

"This strategic transaction is an important milestone in Acer's long history" said Acer chairman J.T. Wang. "The acquisition of Gateway and its strong brand immediately completes Acer's global footprint, by strengthening our US presence. This will be an excellent addition to Acer's already strong positions in Europe and Asia.  Upon acquiring Gateway, we will further solidify our position as number three PC vendor globally."

"Joining with Acer will enable us to bring even more value to the consumer segments we serve and capitalize on Acer's highly regarded supply chain operations and global reach to expand the scope of the Gateway and eMachines brands around the world," remarked Gateway CEO Ed Coleman.  "Acer has made impressive strides in the global PC market and the board and I welcome this merger."

From statements made by representatives for both companies, it appears that the eMachines brand -- which Gateway acquired 2004 for roughly $262 million USD -- and Gateway brand will live on under Acer's massive wings. The retention of the brands also means that Gateway will likely continue to flaunt its "cow heritage" much like the Chick-fil-A restaurant chain.

Almost exactly one year ago, it was reported that John Hui offered $450 million USD to purchase Gateway's retail division. The bid, however, was never accepted by Gateway. "I am very disappointed that Gateway has chosen not to constructively engage in discussions with me and my advisors on the proposal that I sent to you on Aug. 3," said Hui in August, 2006. "I believe that management and the board need to adopt a sense of urgency to address Gateway's problems."

The news of Acer’s acquisition comes just weeks after Gateway’s announcement that it would enter the Chinese PC market with desktop and notebook computers.



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Wow..
By Araxen on 8/27/2007 9:33:40 AM , Rating: 2
I remember when Gateway PC's were really really popular. How the mighty have fallen!




RE: Wow..
By AmberClad on 8/27/2007 9:43:43 AM , Rating: 2
Whatever did happen to Gateway, I wonder. They seemed to be one of the top PC builders and the cow motif seemed to be everywhere in the mid-90s. Then Dell came out of nowhere.

I kind of wonder if it was partly due to Gateway being slower to get rid of the tired beige-box designs, and adopt the more modern silver/black color schemes that Dell and HP-Compaq moved over to. Also, both of those two companies have other major product lines too, like LCDs and printers.


RE: Wow..
By SexyK on 8/27/2007 9:43:48 AM , Rating: 3
I remember when Gateway was Gateway 2000... that naming scheme sorta went out of style with the 1900's though. At least they are keeping the cows!


RE: Wow..
By AmberClad on 8/27/2007 9:49:29 AM , Rating: 2
I actually haven't seen much of the cows lately (or any Gateway advertising for that matter). Maybe they do need to work on reinforcing the brand image. Animal mascots can work great (Aflac, Geico, Linux, etc).


RE: Wow..
By euclidean on 8/27/2007 12:59:33 PM , Rating: 1
More like it was due to everyone finding out they used recycled parts and tried playing them off as new...that and Dell coming out pretty much sent them packing....then the Emachine era that I thought destroyed the name....though they came back pretty strong the last couple years...great laptops. I wonder how they'll hold up now...


RE: Wow..
By 440sixpack on 8/27/2007 6:36:46 PM , Rating: 2
Yep, my first PC in 1994 was a Gateway 2000 486DX2-66, and my second was a Gateway PIII-550 in 1999. Don't buy premade ones anymore but I always enjoyed the cow theme, adds a little whimsy to an often times far too serious business.


RE: Wow..
By Visual on 8/27/2007 9:44:49 AM , Rating: 2
yes and they even had shops in off-this-world places such as my county...
i've always been very annoyed by the fact they went usa-only a few years back. they are currently the only manufacturers of decent tablet convertibles (read: with decent dedicated graphics) and i want one so badly and can't have it here.
besides the asian market, i hear they recently reentered some country in eastern europe, but not sure which - not mine anyway. but that rumor gave me hope for the future...

i wonder if acer will make them more accessible here now. acer craptops are all over our market.


RE: Wow..
By ObscureCaucasian on 8/27/2007 12:40:56 PM , Rating: 2
They seem to go back and forth a lot.

Gateway 2000 (heh) used to be popular in the 90s, but Dell stole a lot of sales from everybody. I really think Dell needs to start selling in retail stores like HP does. Dell does seem to give the best academic discounts because they are about all I see in classrooms these days.


RE: Wow..
By thecoolnessrune on 8/27/2007 3:42:39 PM , Rating: 2
Umm.. Dell does sell in retail stores now..

Additionally, I love my old 350Mhz PII Gateway 2000. Most durable computer I had ever owned.


RE: Wow..
By tjr508 on 8/27/2007 10:27:51 PM , Rating: 2
I got an uncle that still looks at the internets with an old Gateway PP-180, 64 edo ram, 8mb video, and 3 gig HD.


RE: Wow..
By Rampage on 8/28/2007 12:41:42 AM , Rating: 2
Kudos to your uncle, he must know what he's doing contrary to most people (even people reading this site).

You can do what he's doing if you keep up with proper maintenance (Spybot and some antivirus), keep it running clean and don't fill it up.

Might be stuck on Windows 95 but whats the difference if you aren't gaming. 95 and 98 could be very stable if you had decent hardware.

It's easy to build a new PC every year. Some people even while doing that STILL can't keep a PC working.


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