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Samsung refuses to buy HP's PC business

Wealthy minnow refuses to swallow bloated whale

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Samsung made it clear today that it is not interested in buying HP's PC business, despite market rumours to the contrary.

Not usually so chatty about such speculations, Samsung released a statement from its chief executive, Choi Gee-Sung, denying any thoughts of picking up the unit, which Hewlett-Packard said last week it may "spin off".

"To put to rest any speculation on this issue, I would like to definitively state that Samsung Electronics will not acquire Hewlett-Packard's PC Business," Choi said.

"Hewlett-Packard is the global leader in the PC business with sales of 40 million units last year, while Samsung is an emerging player in the category and sold about 10 million units in 2010. Based on the significant disparity in scale with Samsung's own PC business and the complete lack of synergies, it would be both unfeasible and imprudent to even consider such an acquisition."

Speculation about who might buy the unit has been rife since HP announced last week that it was exploring the idea of "separation of its PC business into a separate company through a spin-off or other transaction".

Samsung had been tipped as a possibility by some media reports not just because it might be good for the company, but also because they might actually have the readies for such a bid.

Moody's Investors Service ranked Samsung as Asia's second most cash-rich company in November 2010, with a packed wallet of more than $18bn.

Other Asian firms that are possible HP shoppers, such as Lenovo and Acer, don't have such deep pockets.

Lenovo put its cash reserves at $3.6bn in its Q2 2011 report. The Reg doesn't have a figure for Acer's current reserves but analysts and observers think it is unlikely that the Taiwanese firm has a big wad to blow.

"Only Samsung and Lenovo have the money to buy HP's business, but they have to consider the compatibility of their business models," Vincent Chan, an analyst at Yuanta Securities in Taipei, told Reuters last week. ®

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