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Lenovo dismisses IBM server biz buyout rumour

Posted: 29 Jan 2008     Print Version  Bookmark and Share

Keywords:IBM server business  buyout rumour  China market 

Lenovo Group clarified Jan. 25 that contrary to speculations, it has not acquired IBM Corp.'s sever business, according to a report from

The China PC manufacturer, however, earlier announced a licensing agreement with IBM to make a series of Lenovo-branded tower servers and rack servers based on IBM's x86 server technology and sell them in markets outside mainland China. Entering a market dominated by IBM, Hewlett-Packard and Dell, Lenovo is reportedly aiming at small and medium business enterprises, a market it has been trying to penetrate for two years.

Rumours circulated that Lenovo may acquire IBM's server business after it has successfully absorbed the latter's PC business. However, since IBM's server business has been profitable—generating over Rs.39,478.39 crore ($10 billion) in annual sales revenue—Lenovo would need a large amount of money to make the deal. Several market analysts dismissed the news as mere gossip.

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