Acer Plans to Acquire Gateway in $710M Deal
With acquisition, Acer would vault pass Lenovo to become world's No. 3 PC maker. Lenovo has its own deal in the works to acquire European PC maker.Posted — Updated
Acer is offering to buy Gateway for $1.90 per share in a deal expected to complete by December, pending regulatory approvals in Taiwan and the U.S., Acer said in a statement.
The acquisition has been unanimously approved by the boards of directors of both Gateway and Acer and is subject to standard closing conditions, it said.
Irvine, California-based Gateway is the third-largest PC vendor in the U.S. by market share after Hewlett-Packard Co. and Dell Inc.
The deal could vault Acer past Lenovo to become the world's third largest PC maker. However, Lenovo, which has its headquarters in Morrisville, N.C., is in negotiations to buy Europe-based Packard Bell.
The Gateway acquisition will create a multi-branded computer company with over $15 billion in revenues and shipments in excess of 20 million units per year, Acer said in the statement.
"This strategic transaction is an important milestone in Acer's long history," said J.T. Wang, Acer's chairman, in the statement. "This will be an excellent addition to Acer's already strong positions in Europe and Asia."
Acer President Gianfranco Lanci said the merger will allow Acer to implement an "effective multi-brand strategy and cover all the major market segments."
The merger will result in reductions in per unit procurement and component costs, and also create an opportunity for the cross-selling of product portfolios, he added.
Ed Coleman, chief executive of Gateway, welcomed the move.
"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," he said in the statement.
Acer is the world's fourth-largest PC maker behind Hewlett-Packard, No. 2 Dell and third-ranked Lenovo Group, according to research company Gartner Inc.
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