Chinese firm will buyout German rival to increase presence in Europe.
Lenovo has agreed to buy German PC and notebook maker Medion in a deal worth about $900 million. The deal will double its market share in Germany to 14 percent. Germany has the largest economy in Europe, but it is a slow-growing market which has prompted some analysts to question the decision.
"Lenovo probably wants to add to its presence in mature markets," said Vincent Chen, an analyst with Yuanta Securities.
"The question is why Germany, because that's a very slow growth market and it raises questions on how much benefit this will bring to them."
Medion offers low-priced computer and electronics devices in Europe, and its affiliated with German discount retailer Aldi has given its name a boost in the European market.
At the same time as Lenovo was spilling the details on the Medion deal, Acer announced it would write down excessive inventory and cover potential losses in Europe with a $150 million charge. It will also layoff 300 employees in Europe.
"Lenovo probably wants to add to its presence in mature markets," said Vincent Chen, an analyst with Yuanta Securities.
"The question is why Germany, because that's a very slow growth market and it raises questions on how much benefit this will bring to them."
Medion offers low-priced computer and electronics devices in Europe, and its affiliated with German discount retailer Aldi has given its name a boost in the European market.
At the same time as Lenovo was spilling the details on the Medion deal, Acer announced it would write down excessive inventory and cover potential losses in Europe with a $150 million charge. It will also layoff 300 employees in Europe.
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