Under terms of the agreement announced Monday, Acer will purchase all of Gateway’s outstanding shares for $1.90 per share. The deal has already been approved by the boards of directors at both companies and should be completed by the end of this year, subject to government approval, Acer said in a statement. Gateway’s shares ended at $1.21 Friday on the New York Stock Exchange.
“This is the biggest acquisition in Acer’s 30 year history,” said J.T. Wang, Acer’s chairman, speaking at a news conference in Taipei. “After this acquisition, we are solidly number three in the global PC market,” Wang said. Acer’s acquisition deal with Gateway also derails rival Lenovo Group Ltd.’s plans to acquire Packard Bell BV.
Alongside the acquisition deal with Acer, Gateway unveiled plans to exercise its right of first refusal to acquire shares in Packard Bell’s parent company, PB Holding Co. SARL, from John Hui. Hui is the founder of eMachines Inc., which Gateway acquired in 2004, and the largest shareholder in Packard Bell. Gateway did not disclose how much it has offered for Hui’s stake in PB Holding. Acer’s efforts to overtake Lenovo will get a big boost from Gateway, which was the world’s eighth largest PC vendor during 2006. Together Acer and Gateway shipped 18.6 million PCs during 2006, compared to 16.6 million PCs shipped by Lenovo.
The Gateway acquisition will have the greatest impact in the U.S., where Acer has been growing fast but remains in sixth place among PC vendors.
Source: ComputerWorld