News Column

Acquisition expected to boost Lenovo's N.C. presence

January 23, 2014

By Laura Oleniacz, The Herald-Sun, Durham, N.C.



Jan. 23--DURHAM -- Personal computer maker Lenovo, a China-based company that also has a headquarters in Morrisville, will "essentially double" its presence in North Carolina when it finalizes the purchase of part of International Business Machine Corp.'s computer server business.

That's according to Peter Hortensius, Lenovo's senior vice president, who spoke in a conference call with reporters on Thursday about the deal Lenovo struck to acquire IBM's low-end x86 server business for $2.3 billion.

Lenovo already employs about 2,200 employees in its headquarters in Morrisville, and the company has approximately 300 employees working in Whitsett in Guilford County, where employees make ThinkPad and desktop computers, said Jay Parker, president of Lenovo North America

The company is expected to offer employment to 7,500 IBM employees in the x86 business, according to a news release from Lenovo about the deal. The employees are located in 650 countries around the world, but Parker said the Research Triangle Park is considered to be "a, if not the, headquarters for that business." He said IBM has several executives for the business here as well. The details of where the employees will be located will be determined in the next six to nine months.

"I think this is great news for the state and the Triangle area," Parker said. "It's a fast-growing, successful technology-based company that has roots here and is committed to this area. I think that is all good news."

Parker added that the acquisition of IBM's x86 server business fits with Lenovo's 2005 acquisition of IBM's personal computer business.

The personal computers that Lenovo makes use similar processors, hard drives, memory, and a lot of the same manufacturing and supply chain processes as the servers do, he said.

"For that reason, it offers a lot of economy of scale and a lot of efficiency between our two businesses; it makes ... a lot of sense, for Lenovo to have this business. It's no longer what IBM is focused (on)," he said.

In the conference call on Thursday about the deal with Lenovo, Tom Rosamilia, senior vice president for IBM's hardware business, known as the systems & technology group and integrated supply chain, said IBM has a "significant business" in the Research Triangle Park in software as well as hardware.

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Source: Herald-Sun (Durham, NC)


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