RealTime IT News

Acer Gets Gateway

Taiwan's Acer Inc. will purchase Gateway for $1.90 per share, or about $710 million, the companies announced today. As a bonus, the company gets Packard Bell, which Gateway announced it would acquire before being acquired itself.

Acer said the Gateway acquisition has been unanimously approved by the boards of directors of both Gateway and Acer, though it remains subject to standard closing conditions, including approval under Hart Scott Rodino, Exon Florio and similar laws outside the U.S. The acquisition is expected to close by December.

Acer said the combination will result in "significant" revenue and cost synergies. An in increase in scale is supposed to reduce per unit procurement and component costs. Savings are also expected through the increased efficiency of the combined back-office functions. Acer expects synergies to be at least $150 million.

Gateway announced it intends to exercise its Right of First Refusal to acquire from Lap Shun (John) Hui, all of the shares of PB Holding Company, S.ar.l, the parent company for Packard Bell BV.

With Gateway and Packard Bell in the fold, Acer Chairman J.T. Wang said the company will create a multi-branded PC company with over $15 billion in annual revenues, solidifying its position as the No. 3 PC vendor globally. Acer said it expects to ship over 20 million PC units annually.

"The acquisition of Gateway and its strong brand immediately completes Acer's global footprint," Wang said in a statement.

As a part of today's deal, Gateway said it is currently in discussions with a third party to sell its U.S.-based professional business.