Acer increases access to European markets where currently challenged.
Lenovo's move into European markets via their intended play on Packard Bell now blocked.
On Monday, August 27, 2007 Acer Inc. announced that it will be acquiring rival PC maker Gateway Inc. Through this strategic play, Acer gains access to Gateway's expertise in the direct sales build-to-order business model—a model new to Acer. In addition, through Gateway's investments in Packard Bell, Acer will gain access to the European marketplace, an arena it has had difficulty entering in the past. Of further interest, Acer's acquisition essentially blocks Lenovo's move to acquire Packard Bell, a move likely motivated by Lenovo's interest in increasing its market access in Europe.
Tactically, Gateway's mid-level desktop products and eMachines low-end desktop models provide an opportunity for Acer to broaden its desktop portfolio. Acer's notebook portfolio is already well populated. In the US marketplace, Acer can gain immediate market share increase through the acquisition of a competitor. Gateway is still a player in the US market's largest electronics retailers, Best Buy and Circuit City.
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