Fujitsu considers selling its PC business to Lenovo

Lenovo snapped up most of the PC business of another Japanese company, NEC, in July

Lenovo may be about to grow its share of the shrinking PC business again: Japanese IT conglomerate Fujitsu is considering selling its PC manufacturing business, and Lenovo may be the buyer, Fujitsu said Thursday.

As part of a strategy to focus on core activities, in February Fujitsu spun out its PC business as an independent operating unit. Such spin-outs are usually a prelude to a sale.

On Wednesday, Japanese media reported that the company was in talks to sell the PC business to Lenovo.

"These reports are not based on any official announcement made by Fujitsu," the company said Thursday, adding that it "is currently considering various possibilities, including what is being reported, but a decision has not yet been made."

Once a powerhouse of PC production, Japan has largely retreated from the market over the last decade. Sharp pulled out of PC manufacturing in 2010 to concentrate on the tablet market. In 2011, NEC put its PC business into a joint venture with Lenovo, which went on to buy the majority of NEC's stake in July. And in 2014, Sony sold its Vaio PC business to an investment firm.

A person familiar with the Lenovo-Fujitsu discussions told the Wall Street Journal that the deal could be structured similarly to the one with NEC, which now holds only a 5 percent stake in its joint venture with Lenovo.

Lenovo made a name for itself outside China as a PC manufacturer when it bought IBM's PC division for US$1.75 billion in 2005, vaulting into third place in the global PC market.

Fujitsu targets the data center market with its servers, networking equipment, batteries and cooling systems, and also runs an IT services and cloud hosting business. But it also has other businesses not directly related to that, including smartphones, semiconductors and PCs.

Like IBM before it, Fujitsu is looking to hang on to its more lucrative services and servers businesses -- although even this could change. Almost a decade after their PC deal, IBM went on to sell part of its server business to Lenovo, too. 

 

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Peter Sayer

IDG News Service
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