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
"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
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.