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Gateway shareholders express their outrage over the $710 million USD Acer acquisition

Acer made a surprise move in late August when it announced its intentions to purchase U.S.-based Gateway, Inc. The deal was valued at $710 million USD and was crucial in helping Acer get a stranglehold on the U.S. market. Gateway is currently the fourth largest PC manufacturer in the U.S., while Acer is the third largest PC manufacturer in the world.

"The acquisition of Gateway and its strong brand immediately completes Acer's global footprint, by strengthening our US presence," said Acer chairman J.T. Wang at the time of the announcement.

"Acer has made impressive strides in the global PC market and the board and I welcome this merger," added Gateway CEO Ed Coleman.

All is not roses, however, when it comes to the merger. Shareholders in two separate lawsuits are claiming that Gateway was worth well more than the $710 million USD price tag that was agreed upon. The shareholders note that Gateway had a fiduciary responsibility to its shareholders and was not putting its shareholders interests in mind when it agreed to the acquisition.

"The Company’s directors breached their fiduciary duties to stockholders by approving the Merger Agreement and the transactions contemplated thereby, including but not limited to the Offer, and claims that these transactions are both unfair and coercive to the public stockholders in a sale of the Company," the lawsuit claims.

The lawsuit goes even further to indicate that "The Company’s directors breached their fiduciary duties by failing to include certain information in the Schedule 14D-9, which purportedly denies the stockholders a fully informed voluntary choice whether to approve the Merger Agreement or seek appraisal."

It is not known what price shareholders would have been content with concerning the Gateway purchase, but John Hui offered just $450 million USD for Gateway's retail division in August 2006. Gateway rejected the offer.

Wang Jen-tang, Acer's chairman and CEO, has even noted that its investors and some market analysts indicated that the $710 million price tag may have been too much. "Regarding the criticism that the price is too high, I think whether a price is high depends on whether the buyer will in the end be able to realize synergies," said Jen-tang to the Financial Times. "If he is able to do that, then it is not high. If he can't realize the synergies, then it's a very high price."

Shareholders may also be smarting over Gateway's priority position when it comes to Packard Bell. Gateway has the right of first refusal (ROFR) for complete control of PB Holding Company, -- thus gaining complete control of Packard Bell. Gateway acquired the ROFR in June 2006 from Hui.

Jen-tang plans to exercise the right and is already discussing Acer's plans for Packard Bell.

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RE: Gateway still exists?
By HotdogIT on 9/13/2007 10:09:05 PM , Rating: 3
The CPU on the PC I run at home (build with beta parts) will still not be available to the market place for about another 18 months. Yes, nothing in the market place will touch it unless you spend around $7,000.00.

You tried really, really hard to lie in your post, and I commend you for that.

1) Your CPU is so good, nothing on the market can touch it... unless you spend 7k. On a CPU. To beat a CPU you claim to be using. So what CPU can I buy, for 7k, that would beat it?

2) You're "in the channel". "In the channel." I can promise you you're not in any channel, Intel or AMD. I can guarantee that.

However, in your world there is no real new technology….Hmmmm did you ever think that maybe there is new technology you’re just not buying it?

Well no shit. Of course there are newer items being used and tested. I just highly doubt some semi-literate retard is using them and posting on a forum about using them.

you believe they have the best stuff or the same stuff as everyone else because they told you they do.

As in, they have the best stuff currently on the market, since all parts are created equal (ie, a Q6600 from HP is going to be the same physical part as a Q6600 from Dell?)? Then yes. We never claimed to be using the most recent beta parts, mostly since we don't suffer from compulsive lying on a message board.

but remember they were buying for the larger volume of sales; the manufacture was/is building to fill what should be double the volume. This leaves a lot of parts just sitting around getting old. Where do you think those parts are going to go?? If you answered, in their systems you’d be correct.

My brain just cried a little bit. If you're claiming this is why there are still Pentium D boxes on the market; well no duh. But it's not like they're relabeling Pentium Ds as C2Ds and selling them to people; you KNOW (whether you understand the differences or not) what you're getting.

If you buy from them then yes, there is no real new technology; they are still getting rid of the old items first. It is very hard for a large company to keep up with new technology, it always has been and it always will be.

But there in lies the problem: Even the "high end" shops such as Velocity Micro, Falcon NW, etc, etc are using the SAME PARTS. If there was a company building and selling Nehalem-based systems, you can bet SOMEONE would be buying them.

I honestly don't know what your entire post was focusing on: Were you honestly thinking we thought progress had been totally stopped on the technology front? The original quote you quoted, "there is no suck <sic> thing as old technology anymore" is partially accurate: If you go to Dell's site, or HP's site, most of their product line is now based around the current technology of the time: C2D and X2. Just as every OEM.

And now, since I'm really looking to be downrated, here's but a small sampling of your spelling mistakes. The corrections are in bold.

Wow when did we enter the time freeze vortex?

I say, dear gents, when did we enter a time freeze VORTEX?

The CPU on the PC I run at home (build with beta parts) will still not be available to the market place for about another 18 months.

Hah! Dear friends, the CPU I run at home, built with BETA parts mind you, will still not be available to the market place for... oh, I'd say another 18 months or so! Evil laughter track!

Yes, nothing in the market place will touch it unless you spend around $7,000.00. No, I did not pay that, I’m in the channel, I beta test items, no I can not give out details and yes it’s nice to see tomorrow’s technology today.

No sirre-Bob, nothing will touch my 409!, unless of course you spend... oh, 7 THOUSAND AMERICAN DOLLARS! And of course I didn't pay that... I'm in the CHANNEL! *Pause for dramatic response from crowd* That's right folks... the CHANNEL! I went to an Intel Channel Conference once, since I won the drawing at Best Buy!

The main reason it’s fast is that it has only new technology parts.

I'm a fucking retard and should be castrated, so my seed will never be able to spawn more of me!

And... fin!

RE: Gateway still exists?
By Ryanman on 9/16/07, Rating: 0
"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings
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