HP reportedly considers selling PC business, upstream players say no

HP logoThe largest global notebook brand vendor Hewlett-Packard (HP) is reportedly considering selling its PC business with Korea-based Samsung Electronics the most likely buyer, according to a Chinese-language Commercial Times report.

However, Digitimes sources from the upstream component industry pointed out that the rumors have been circulating around Taiwan's IT market since the fourth quarter of 2010, but the deal was called off due to an unknown reason, and there has not been any follow up since then. HP also declined to comment about the rumors.

The paper noted that HP also had contact with players such as Lenovo and Foxconn Electronics (Hon Hai Precision Industry), but Samsung, which has a strong economic scale, is likely to offer a higher price to force out its competitors.

Since Samsung has recently been working aggressively on its notebook brand business, causing its notebook brand clients from the component business to start reducing their orders as a counter measurement, acquiring HP's PC business should help the company resolve the issues, while helping to digest any extra capacity generated in the future, the paper explained.

Meanwhile, since Samsung already has a strong brand reputation in both the LCD TV and handset industries, HP's PC business should help fill the gap in its product lines, the paper added.

However, Digitimes sources believe the possibility of HP selling its PC department is rather low, despite that revenues from the company's PC business in its the fourth quarter report were lower than expected, the business still contributed stable profits and the company is currently still the largest vendor in the global notebook market, as well as both the key markets Europe and the US.

With HP CEO also recently saying the company will adopt webOS into PC products to challenge Apple, selling its PC business would also contradict its current strategy, the sources added.

Source: DigiTimes

Tags: HP

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