Lenovo Gearing Up to Compete in Tablet Marketplace

Lenovo to Purchase Motorola Mobiliity
Lenovo to Purchase Motorola Mobiliity

There is speculation that Chinese computer giant Lenovo Group Ltd will buy Motorola Mobility from Google Inc. If the sale does go through, Lenovo will have more to say about the international tablet and smartphone market.

A deal, which is estimated to be worth not less than $2 billion, will give Lenovo access to 10,000 mobile communications patents which are now in the possession of the US-based Google. Lenovo spokesman have only said that they will be making an announcement about a “major acquisition” this coming Thursday, but no further details about that acquisition have been forthcoming.

Lenovo is the world’s largest personal computer manufacturer, but would like to make a bid to wrestle some business away from Apple Inc and Samsung Electronics in the global consumer electronics marketplace.

Apple and Samsung currently dominate the US and Western European markets for consumer electronics. Yang Yuanqing, chairman and CEO of Lenovo is aiming to challenge those companies for market share by 2015.

Google would like to sell Motorola Mobility as it is a money-loss subsidiary, to the tune of about $248 million during the third quarter of 2013, as stated in the Google financial report. Google paid $12.5 billion for Motorola Mobility in 2011.

The expected deal comes in the wake of Lenovo’s announcement that it plans to purchase IBM Corp’s x86 server unit for $2.3 billion. If the US government approves the deal then it will be the single largest deal involving a Chinese company to date.

About Jonathon Bowes

Jonathan Bowes started his career in banking. After a few years, he took courses in business and finance and worked his way up the corporate ladder. Today, while writing part-time for Business District, Bowes assists talented people to find jobs in the field of economics. Contact Bowes at Jonathon[at]businessdistrict.com