Lenovo To Form Arrangement With Lexmark To Sell Printers….

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Lenovo To Form Arrangement With Lexmark To Sell Printers….

 news 2016-04-20 at 10:46:43 am Views: 381
  • #45634

    Lenovo Will Form An Arrangement With Lexmark To Sell Printers.
    Lenovo Linked Company Joins Consortium To Buy Lexmark

    By David Richards

    Lexmark International the former IBM printing division has been sold for $3.1 Billion to a consortium of buyers that includes Legend Capital the largest shareholder in Lenovo.

    Legend, holds a 30.6% stake in the Hong Kong-listed Lenovo.

    Other buyers in the consortium include China-based Apex Technology and Asia-focused PAG Asia Capital for $2.54 billion.

    The struggling printer Company at one stage had direct talks with Lenovo, whose management is currently making sure that the integration of the IBM server and the Motorola smartphone business stays on track.


    Executives at the #1 PC Company came to the conclusion after advance  talks with Lexmark, that the concept of integrating yet another, Company into the Lenovo operation at this stage “was too big a risk” said sources.

    It’s expected that Lenovo will form a direct OEM arrangement with Lexmark to sell their printers.

    Lexmark shares were up 12% in late trading to $38.97.

    Legend Capital, is the venture-capital arm of China-based Legend Holdings.

    Apex makes inkjet and laser cartridge components.

    PAG Asia Capital is the private-equity business of PAG, an investment firm that also has real estate and absolute return strategies.

    Lexmark, which posted $3.55 billion of revenue last year, has gone on an acquisition spree, snapping up a number of software assets, to lessen its dependence on the fiercely competitive printing business and move more toward services and software.

    The company, like others in the technology industry, has spent years wrestling with a maturing hardware market.

    In February, it said it would eliminate about 550 jobs over 12 months, around 4% of its workforce.

    On Tuesday, Lexmark said “this is an exciting transaction” that the board “believes is in the best interests of our shareholders following an exhaustive strategic alternatives review process to maximize value.”

    Lexmark will remain in Lexington, Ky., and Chairman and Chief Executive Paul Rooke is expected to continue leading Lexmark after the deal closes.

    The sale is expected to close during second half of the year. It is subject to regulatory approvals including the US Committee on Foreign Investment.

    Lexmark was International Business Machine Corp.’s low-end desktop printing division before the business was sold to buyout firm Clayton Dubilier & Rice in 1991.