Amicable takeover
Lenovo is moving to expand its foothold in Europe's PC with plans to purchase of a majority shareholding in German manufacturer Medion.
Perhaps best known in the UK for its sales of low price computers through German retailer Aldi, Medion is currently majorly owned by Charman Gerd Brachmann, who has a 55 per cent stake in the company. Lenovo plans to purchase a 37 per cent stake in Medion from Brachmann, for a total of €231 million - or €0.13 a share.
That same offer is being extended to other shareholders, with Lenovo expecting to take a 55 to 80 per cent overall stake through this acquisition. In total Lenovo will pay between €340 and €500 million. With this takeover, Lenovo would raise its market share to around 14 per cent in Germany, and seven per cent in the rest of Europe.
According to Medion CFO Christian Eigan, who also plans to sell his 75,00 shares to Lenovo, the two companies have been in talks for several weeks, and it was Medion who approached Lenovo with the possibility of a buyout.
The deal isn't completed yet, as Lenovo still needs to see if enough other Medion shareholders will give up their shares for Lenovo to secure a controlling stake in the company - Lenovo expects to know if its purchase will go ahead within the next couple of weeks.
