NEC looks to offload Lenovo shares
Kitchen sink next for ailing Japanese firm
Ailing Japanese electronics giant NEC looks set to sell all of its shares in Lenovo after the Chinese PC maker confirmed to The Reg that it has waived a previous restriction on the sale.
The two firms announced in January 2011 that they would be combining their PC operations in Japan, in a joint venture known as NEC Lenovo Japan Group.
As part of that deal, NEC was given 281 million Lenovo shares while the Chinese firm grabbed a 51 per cent share in the joint venture. However, part of the deal required NEC to keep its shares for at least two years after the deal closed.
The shares are now worth a whopping $240m as of Tuesday when the Hong Kong stock exchange closed, according to Bloomberg.
A Lenovo spokesperson in Hong Kong sent The Reg the following statement:
Lenovo can confirm we have granted a waiver regarding NEC shares of Lenovo stock. We believe this is an appropriate action based on NEC's requests and financing needs as well as our shared commitment to our long-term, on-going strategic partnership.
We have built a winning business in Japan together, and we will continue to look for ways to expand and extend our strategic relationship. Lenovo and NEC have momentum in the market and we expect to continue to build a leader in Japan together.
Although the two firms have aired plans to possibly extend their joint PC venture beyond Japan, and there have been rumours of a potential server tie-up, NEC’s preoccupation of late has been simply staying alive.
At the beginning of 2012, NEC forecast a net loss of ¥100bn (£820m) for 2011, after which it decided to slash its workforce by as many as 10,000.
It claimed its domestic smartphone business had been negatively impacted by “foreign vendors” while the floods in Thailand hit its operations there hard.
By contrast, Lenovo has been going from strength to strength in 2012 and isn’t far from toppling HP as the world’s number one PC maker. ®