Lenovo Acquires IBM PC Business

Associated Press

International Business Machines Corp. is selling a majority stake in
its pioneering personal computer business to China's biggest computer
maker, Lenovo Group Ltd., for $1.75 billion in cash and stock.

The widely expected
deal, one of the biggest Chinese overseas acquisitions ever, would make
Lenovo the third-largest PC company in the world. IBM currently holds
that spot.

The sale extends IBM's long-running transition from
leader and innovator in computer hardware to a dominant force in
computer services, software and consulting.

About 9,500 IBM workers will become employees of the new company, doubling Lenovo's work force.

The
stock IBM is receiving will give it an 18.9 percent stake in the merged
company, which will have an estimated 8 percent share of the worldwide
PC market. The combined PC revenue for the two companies in 2003 was
$12 billion.