Lenovo in talks to buy Packard Bell

Acquisition would allow Chinese firm to expand in European market, analysts say.

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By  Michele Howe Published  August 9, 2007

Chinese computer giant Lenovo is understood to be in negotiations to buy European PC manufacturer Packard Bell.

The world's number three PC maker said this Tuesday it was in exclusive talks to buy the Netherlands-based firm from owner John Hui, according to a report by Reuters.

Packard Bell is the number three player in the European PC consumer market and has an estimated ninth position in global PC sales rankings with a 2% market share.

Analysts say the purchase of Packard Bell, which had estimated revenues of US$2 billion last year, would be a good move for Lenovo, which is keen to expand in the European market and boost its consumer business.

"Lenovo has to move to improve its performance in the consumer market quickly," JP Morgan analyst Charles Guo told Reuters. "This one is easy because Packard Bell is much smaller and its business in the mid-to-high end consumer PC market matches Lenovo perfectly."

Lenovo is not the only firm rumoured to have shown interest in Packard Bell with rival Acer also said to have looked at the European player.

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