Lenovo in Talks to Acquire Packard Bell

By Ed Oswald, BetaNews

August 8, 2007, 10:28 AM

Packard Bell may be on the selling block yet again. Lenovo said Tuesday that it is in talks to acquire all or a portion of the computer maker to give it a foothold in the European market.

Neither side has talked about how big of a stake in Packard Bell that Lenovo is looking to purchase, nor a possible price.

Chinese-American entrepreneur Lap Shun "John" Hui bought the classic computer brand in October for an undisclosed sum from NEC. It once sold computers worldwide, although since then has pulled out of many markets, including the US, and focuses on Western Europe.

Lenovo is third overall in worldwide PC shipments, although much of that success is due to it controlling a third of the market in its home country of China. Outside of China, its sales of the popular ThinkPad line to businesses have kept it afloat.

However, the market is changing and consumers are now becoming a larger chunk of computer sales. In order to stay competitive, Lenovo needs to grow its consumer PC business, especially in markets outside of China.

In Europe, it trails leaders HP, Dell, and Acer. With Packard Bell, Lenovo would have about an 8 percent share, putting it in fourth place. Packard Bell's strong retail relationships could help Lenovo grow that even further.