The buzz is building. Lenovo, the world's fourth largest PC manufacturer, confirmed it's in talks for an acquisition, though it has not yet named the target nor confirmed if formal negotiations are happening.
Both Positivo Informatica, Brazil's biggest computer maker, and Fujitsu's Fujitsu-Siemens PC business were mentioned by Reuters, the Wall Street Journal and other sources as names in the mix.
"The directors confirm that the company has certain preliminary discussions with independent third parties regarding potential investments opportunities and acqusitions," said Lenovo Chairman Yang Yuanqing in a statement to Reuters.
Investment analysts told Reuters any potential acquisition by Lenovo was probably months away. A tough economic climate and the worldwide slowdown in PC demand means no one's rushing into anything.
"The merger talk has helped the positive sentiment we have seen in the past few days, which pushed the stock up further," said JP Morgan equity analyst Charles Guo to Reuters. If the price is right, Guo said, "Lenovo is willing to pay a small premium for an acquisition."
Several news outlets reported that if Lenovo is after Positivo Informatica, it's probably facing competition from Dell. According to Bloomberg News Service, executives from both Lenovo and Dell visited Positivo's Curitaba, Brazil-based headquarters last week.
Yuanqing told news outlets back in May that Lenovo is looking to acquisitions to help its expansion. The Chinese company moved its headquarters to the United States after buying IBM's PC division back in 2005; in 2007, it lost a bid to buy Packard Bell to rival Acer.
Lenovo earlier in December reported quarterly profit of $23.44 million -- a 78 percent drop and far south of most analyst forecasts. According to International Data Corp., PC shipments are expected to grow by 3.8 percent in 2009 -- down from IDC's original prediction of 13.7 percent, made early in 2008.
