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IBM, Lenovo to announce JV 'this week'

Big Blue PC division sell-off not on the cards, apparently

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Far Eastern sources continue to claim that IBM and Chinese PC maker Lenovo are in joint-venture discussions rather than pursuing the all-out acquisition of Big Blue's PC division.

Neither company has formally commented on their talks, first reported a few weeks ago. The story was re-ignited last week when a number of US news services claimed IBM was attempting to sell its PC operation.

Reports claimed IBM has hired Merrill Lynch to seek a buyer for the Personal Systems Group (PSG), allegedly with a $2bn asking price. PSG achieved revenues of $3.3bn during the three months to 30 September 2004, but lost $50m. It's the world's third biggest PC company in terms of sales.

Last week, IBM announced the formation of a consortium, Power.org, to promote the use of its Power and PowerPC processor lines in the Asia-Pacific region for both embedded and computing products. That might seem confirmation of a shift of focus away from x86, but PowerPC comes out of IBM's Systems and Technology Group (STG), which has always had a different agenda from PSG.

Sources said to be familiar with the deal say an announcement will be made on Thursday, 9 December this week, according to a DigiTimes report.

Meanwhile, Chinese-language newspaper the Economic Daily News has pegged 15 December as the date at which Lenovo and IBM will formally comment on their discussions.

Far Eastern sources continue to suggest, contrary to last week's reports out of the US, that IBM and Lenovo are exploring the merger of their respective operations into a separate, jointly owned company. The JV would leverage both firms' brands, and seek to exploit the economies of scale. ®

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