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Lenovo wins US nod to buy IBM PC
(China Daily)
Updated: 2005-03-10 01:49

SAN FRANCISCO: Lenovo Group Ltd won clearance from a US national security oversight committee to acquire IBM's personal computer business, the companies said yesterday, overcoming resistance from some US lawmakers.

Customers talk with sales staff at a Lenovo outlet in Shanghai. [newsphoto]

An IBM executive said the high-level US committee had given the deal its unanimous consent the final external approval needed putting the US$1.25 billion PC sale on track to close in the second quarter as originally planned.

"We were able to get unanimous agreement from the members of the committee," Stephen Ward, general manager of IBM's Personal Systems Division, said in a telephone interview. Ward is to become chief executive of Lenovo, which is headquartered in Beijing, once the deal closes.

The merger of the IBM PC business with China's biggest PC maker the first combination ever of a major US corporation and a top Chinese one will create the world's third largest PC maker and one strongly positioned in several fast-growing markets.

The deal met unexpected resistance when some US lawmakers began decrying the loss of a US-based PC maker to China on national security accounts.

The go-ahead from the Committee on Foreign Investment in the United States (CFIUS) was received on Tuesday, Ward said.

CFIUS is composed of 11 US agencies and was created in 1998 to conduct security reviews of business deals.

Ward said terms of the approval are confidential, but that no compromises were required over the location of Lenovo facilities in sensitive research areas, nor were limits put on Lenovo's ability to sell PCs to US agencies.

"I don't think we made any compromises at all," Ward said.

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