Asian crisis halts Siemens PCs sale
Hardware Acer puts investment on hold after European reshuffle.
Siemens Nixdorf has cancelled the proposed sale of its PCuffle. manufacturing business to Acer, citing unacceptable terms proposed by the Taiwanese manufacturer.
As predicted in PC Dealer (22 July), Acer's agreement to buy Siemens' ailing manufacturing business was under threat as 'unforeseen complexities' continue to stall attempts to thrash out a deal. The purchase was originally expected to close in July.
The surprise ending of negotiations, which were started in April, for the sale of the 2,000-worker factory was put down to the fact that the Asian economic crisis is forcing Acer to restructure its operations.
Acer was not willing to meet Siemens' minimum asking price because of concerns in the Taiwanese company that it would not sell sufficient numbers of PCs, given current economic conditions, to get a good return on the investment.
In a released statement, Acer claimed that its primary reason for the halt in negotiations was due to 'concern aroused by the financial crisis raging throughout Asia as well as Russia, causing the Taiwanese PC manufacturing giant to exercise real cautiousness in investment planning'.
The Taiwanese manufacturer said it would focus its finances on the struggling Semiconductor Business Group. The Group has already slashed its profit forecast for the year by a third.
Siemens claimed it had not ruled out finding another buyer and said it would spin off the manufacturing operation into a private company, to be renamed PCS, under the auspices of its information services and communications division.
Meanwhile, Acer has restructured its European operation and is setting up its European headquarters in Slough, Berkshire. The sales, marketing, channel and brand strategy will be decided from this base to give a more consistent message to its partners.
Finance and logistics will be controlled from Acer's offices at Ahrensburg in Germany.
Under the reorganisation, Anita Bowles, formerly marketing director at Acer UK, will head the company's European marketing.
FALLING PRICES FORCE US CHIP PLANT CLOSURE
Matsushita has become the fourth Japanese semiconductor manufacturer this month to consolidate its chip operations because of falling memory prices.
One of Japan's largest consumer electronics group, Matsushita revealed last week that it would close its US plant in December because of the sharp decline in prices of DRam chips. The plant was based in Puyallup, Washington, and made 4Mb chips.
In a statement, the company said: 'The decision was made in view of the increased difficulties in continuing the US chip subsidiary operations due to the effects of changing semiconductor market conditions, such as the sharp decline in DRam prices since the beginning of last year.'
Matsushita joins Fujitsu, which closed down its chip factory in the UK, Hitachi, which merged its two US units and Mitsubishi, which also closed down its integrated circuit plant in the US.
One analyst claimed that Matsushita's chip operation was making a loss and that the closure was a good move for the company to save costs. In its latest figures, Matsushita reported a four per cent increase in component sales from Y1,512 billion to Y1,566 billion but admitted that its D-Ram business had been hit by an 80 per cent fall in global memory prices.