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Report: IBM's PC Business Up for Sale

Report: IBM's PC Business Up for Sale

by , 8:00 AM EST, December 3rd, 2004

IBM has decided to sell its personal computer business and is in negotiations with China's largest maker of personal computers to buy it, the New York Times reported Friday.

Sources told the Times IBM is in serious discussions with Lenovo Group Ltd., formerly known as Legend, and at least one other potential buyer for the unit. The sale, which reportedly will be in the US$1 billion to $2 billion range, will include desktop, laptop, and notebook computers manufactured by IBM.

IBM has manufactured PCs since 1981. The PC business represents about 12% of I.B.M.'s annual revenue of $92 billion.

"A sale now, if it happens, would be consistent with the strategy pursued by Samuel J. Palmisano, who became I.B.M.'s chief executive early in 2002," wrote the Times reporters Andrew Ross Sorkin and Steve Lohr. "He has sold hardware businesses where profits were slender and growth prospects were limited, like its hard disk drive business, which was sold to Hitachi."

Spokespersons for IBM and Lenovo declined comment on the story.

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