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Thursday, 27 January 2011 20:25

Lenovo and NEC JV creates Japan's largest PC group

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Lenovo and NEC are joining forces to create the largest PC group in Japan with plans for strategic cooperation in other areas.

Lenovo and NEC Corporation have announced a joint venture between the two companies, forming the largest PC group in Japan. The agreement aligns NEC, Japan's number one PC company, with Lenovo, the fastest growing top-five PC maker in the world and gives both companies an opportunity to grow their commercial and consumer PC businesses in the third largest PC market in the world.

The company formed from the joint venture will be called the NEC Lenovo Japan Group. Lenovo and NEC will establish a new organisation called Lenovo NEC Holdings B.V.

Lenovo will hold a 51 percent stake in the new joint venture with NEC holding a 49 percent stake. Hideyo Takasu, currently President, NEC Personal Products, Ltd., will become President and CEO of the new joint venture, while Roderick Lappin, currently Representative Director and President, Lenovo (Japan) Ltd., coming in as Executive Chairman.

Lenovo (Japan) Ltd. and NEC Personal Computers, Ltd., a new company formed as a result of separating NEC's PC business from NEC Personal Products, Ltd. will both become 100 percent subsidiary companies of the new joint venture. As the result of this transaction and upon closing, NEC will receive from Lenovo US$175million through an issue of Lenovo shares.

'The agreement with NEC is a perfect fit for our strategy. It reinforces our commitment to our core PC business while, at the same time, providing important new opportunities for growth in Japan,' said Yang Yuanqing, CEO, Lenovo. 'We have a long history of innovation in Japan and a firm commitment to the Japanese market. Now, we are combining our global strength and momentum with NEC's market leadership. It is the perfect partnership for us and for our customers.'


'Lenovo is the right partner at the right time for NEC, and we believe that we are creating a strategic relationship today that will benefit NEC and our customers for many years to come, said Nobuhiro Endo, President, NEC. 'We believe this alliance will further reinforce and expand our PC business in Japan, upholding the NEC brand name and will continue to provide Japanese PC users with products supported by high quality and service. Taking this strategic relationship as a first step, NEC will accelerate expansion of our IT business worldwide.'

During and after the transition from independent operations to the joint venture, both companies expect that all their existing PC operations, including customer service, product delivery and warranty fulfilment, will continue as usual.

The current product brand names of both NEC and Lenovo will continue, and the joint venture will leverage each company's strength, such as NEC's product development capabilities and Lenovo's procurement resources to develop and to provide the most suitable products to all users in Japan.

For consumer products, NEC and Lenovo will continue to maintain their own brands, and provide sales and support through existing routes. For commercial PCs, NEC will continue to market products and support customers through NEC's current channels.

As part of this strategic alignment, Lenovo and NEC have also agreed to discuss further cooperation in other areas, including selling PCs and providing global support to Japanese companies operating outside of Japan, developing, producing, and selling devices such as tablets and selling additional products such as servers.

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