Gateway sells professional biz unit to MPC

Hopes to milk consumer channels worldwide

For sale sign

Gateway is to sell its education, government and SMB arm of the business to MPC Corporation in a deal valued at about $90m.

The US-based computer maker, which just last week was bought out by Acer for $710m, will be given close to a 20 per cent stake in MPC stock - worth about $20m - once the deal is completed.

In a marked move away from toughing it out against other vendors in the crowded direct professional marketplace, Gateway said it wanted to streamline its business model and focus on drumming up more trade via its worldwide consumer channels.

Server and PC vendor MPC, which will control the unit's operations and warranty support services, said it will cough up an initial amount of about $10m which will be paid within six months of the deal being sealed.

But MPC added that its final value will be determined by how much inventory Gateway delivers on completion.

Gateway professional products will be available under the MPC brand name within a year.

The transaction is expected to close in the fourth quarter of this year. ®

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