Posted on 12/30/2004 8:34:34 PM PST by maui_hawaii
I.B.M. said yesterday that the personal computer business it was selling to the Lenovo Group of China had not made a profit for three and a half years.
I.B.M.'s personal computing division had a loss of $139 million in the six months ended June 30. It had losses of $258 million in 2003, $171 million in 2002 and $397 million in 2001, I.B.M. said in a filing with the Securities and Exchange Commission. During that period, the PC division had sales of $34.1 billion.
I.B.M., which is based in Armonk, N.Y., does not typically reveal results for its PC division, which is part of its hardware group. That group includes more profitable servers. I.B.M. wants to improve its profit margin by selling the PC unit to Lenovo for $1.25 billion, vaulting Lenovo to third from eighth among global personal-computer makers.
Dell Inc., the world's biggest maker of PC's, has said it is the only large company that is consistently profitable in the computer business. I.B.M. is the third-largest PC maker, behind the Hewlett-Packard Company.
Shares of I.B.M. climbed 12 cents to close at $98.30 on the New York Stock Exchange and have risen 6.1 percent this year. Shares of Lenovo, China's biggest PC maker, dropped 5 cents to close at 2.38 Hong Kong dollars, or 31 cents, on Dec. 30. The shares have fallen 11 percent since the deal was announced on Dec. 7.
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