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IBM Computers to get national security review
Updated Jan 27 2005-When I first read that IBM was selling it PC business to Lenovo Group, headquartered in Beijing, China, I was curious how it would work. If you've bought a high powered PC, then you know you always get the question are you going to export this item. So, how could a company based in America, have a headquarters in Beijing, and make high powered PC's and servers and not be a security risk, if they were worried about the couple PC's I have bought.
Well, now it looks like they will get a security review from the government, because it would be easy for Chinese operatives to use an IBM facility for industrial espionage, or worse.
In a move I am surprised at, IBM is allowing them to use their PC brands, such as the Thinkpad or Netfinity, for five years. But, I guess it had to have something like that in there, I would never have bought IBM computers if I couldn't use their brand recognition.
Lenovo will attempt to combine IBM's resources in the US with it's Europe and Asia divisions and with it's own presence in China, which will create the third largest PC manufacturer in the world behind Dell and HP.
Added: This deal is certainly going to be a lot harder than they originally anticipated, the latest article says,
"First, this transaction may transfer advanced U.S. technology and corporate assets to the Chinese government," according to the letter, signed by Reps. Henry Hyde, chair of the International Relations Committee; Duncan Hunter, chair of the Armed Services Committee; and Don Manzullo, chair of the Small Business Committee. "Second, this transaction may transfer licensable or export-controlled technology to the Chinese government. Finally, this transaction may result in certain U.S. government contracts with or involving (personal computers) being fulfilled or participated in by the Chinese government."
So, it sounds like lots of stuff need to be cleared up to do this deal, if it is even doables at all.
Related articles from other news sites:
Lawmakers raise heat on Lenovo deal Federal lawmakers have cast a deeper shadow on IBM's proposed sale of its PC business to China's Lenovo, saying federal regulators need more time to investigate possible security risks.
In a letter sent Tuesday to Treasury Secretary John Snow, three high-ranking members of the House of Representatives urged the Treasury Department's Committee on Foreign Investment in the United States to conduct a full investigation of the proposed sale.
IBM-Lenovo deal said to get national security review IBM's plan to sell its PC business to Lenovo Group may become a matter of national security.
The Committee on Foreign Investments in the United States, which reviews acquisitions of U.S. businesses by companies based outside the country, has shown concern that Chinese operatives might use an IBM facility for industrial espionage, the Bloomberg news agency reported Sunday, citing unnamed sources. The committee is made up of 11 U.S. government agencies, including the departments of Justice and the Treasury.
The report said that IBM and Lenovo were negotiating with the committee, chaired by the Treasury Department, which would need to give its approval for the deal in order for it to avoid a formal investigation and the need for clearance by President Bush.
IBM sells PC group to Lenovo IBM will sell its PC division to China-based Lenovo Group and take a minority stake in the former rival in a deal valued at $1.75 billion, the companies announced Tuesday.
The two companies plan to form a complex joint venture that will make Lenovo the third-largest PC maker in the world, behind Dell and Hewlett-Packard, but still give IBM a hand in the PC business. The deal is expected to be completed in the second quarter.
IBM-Lenovo deal clears potential block IBM's plan to sell its PC business to Lenovo Group has cleared a potential regulatory hurdle.
The Federal Trade Commission won't raise objections to IBM's plan to sell its business to Lenovo in a $1.75 billion deal, announced in early December.
The FTC announced Friday that it has granted Lenovo and IBM an early-termination ruling under the Hart-Scott-Rodino antitrust act, which says companies planning large acquisitions must notify the FTC and the U.S. Department of Justice in advance, submitting information about how their plans might affect competition. According to the law, the companies must also wait while the competitive aspects of their proposed acquisitions are evaluated. With the FTC ruling, that waiting period is now over for IBM and Lenovo.
IBM's Mr Thinkpad on life before Lenovo But moments later - and we pinched ourselves to make sure we weren't dreaming - we were alone on a boat in San Francisco Bay with a very important person from IBM's Thinkpad division. Robert Herman, the program manager and director for IBM's Global Thinkpad Brand.
Thinkpads aren't just good, they sometimes seem like the last remaining Wintel PC notebook that works. They're sturdy, well made, well supported and there's absolutely no sign of a Windows key. So IBM has decided to get rid of the division, and Lenovo, a Chinese company will co-manufacture Thinkpads for the next five years.
"It's not signed yet," was Robert's response we kicked off with the Lenovo deal.
Sonoma makes its way into the Thinkpad line in the shape of the T43, alongside the current flagship T42. Intel has worked hard on the graphics, and for the first time in the top-of-the-range line IBM includes integrated, rather than discrete graphics support.
IBM Says Lenovo Deal Hurt Q4 PC Sales, Blades Soar IBM acknowledged that the pending sale of its PC business to Lenovo impacted fourth quarter sales, but a 150 percent growth in blade server sales more than offset the slowdown in PCs.
For its fourth quarter ended Dec. 31, IBM revenues reached $27.7 billion, a 7 percent increase over the $24.3 billion recorded a year earlier. Earnings totaled $3 billion, or $1.83 per share, up 12 percent from the comparable 2003 quarter profits of $2.7 billion, or $1.59 per share.
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