That decline is larger than the multichannel retailer’s overall 5.8% sales decline.
The purchase of Germany’s Medion opens Western Europe to the Chinese PC maker.
Lenovo, the Chinese company that acquired IBM’s personal computer division in 2004, is acquiring Medion AG, a German manufacturer and retailer of consumer electronics products and mobile phones.
The total value of the Medion purchase will be 419.0 million euros ($615.1 million), Lenovo says.
The acquisition of Medion, No. 30 in the Internet Retailer Top 300 Europe, further opens the Western European retail marketplace to Lenovo, the company says.
When completed, the acquisition will give Lenovo a more than 14% share of the German personal computer market and approximately 7.5% of the Western Europe PC market, Lenovo says. The agreement fuels Lenovo’s expansion in consumer PCs and the mobile Internet devices. Both company’s boards have approved the deal, which is expected to close in the third quarter, Lenovo says.
“With their strong consumer sales, marketing, services and retail capabilities, Medion AG’s business is perfectly aligned with our consumer growth strategy in Western Europe,” says Yang Yuanqing, Lenovo CEO. “Bringing together this ‘front end’ with Lenovo’s ‘back end’ manufacturing capability and supply chain will make both companies even more successful and competitive.”
Last week, Lenovo announced its fiscal 2010 earnings had topped $21 billion in revenue for the first time.
Medion distributes its products through other retail chains and also sells online at Medion.com.de. The e-commerce site is available in multiple languages.