Acer Inc has announced a $320 million deal for the U.S. based iGware. Acer Inc is a Taiwanese company that is the world’s second largest PC maker. This deal is the fifth largest buyout of a U.S. company by a company based in Taiwan.
Acer is also talking with Nintendo, which is one of iGware’s largest clients. Acer wants to make sure that there is cooperation between the two companies after the deal is finalized. No specifics were given, though.
According to an analyst at the research company Gartner, Tracy Tsai, “This [the buyout] is the right direction for Acer…Companies can no longer rely only on hardware; they have to bring new values to customers.” Acer has been moving towards a larger mobile device product line after the first of the year did not prove to be as good as expected. While Acer has had some great success in the low-end notebook market, it has not been able to see significant success in the tablet market. The iPad has most of that market.
The deal also includes performance based payouts in the future totaling $75 million, bringing the total value of the deal to $395 million. Acer already had the largest deal of its kind when it bought out Gateway in 2007 for $761.5 million.
Acer also opened a new Research and Development center on Monday in Chongqing. This center will focus on developing tablet PCs and smartphones. According to J.T. Wang, the chairman of Acer, the company will post up profits in the third quarter and for the year, even though there was a loss in the second quarter. He believes that the fourth quarter will be even more comfortable for the company.
Analysts have dropped their estimates for Acer’s net income by 13 percent in just the last month. They expect the company’s mean net income to fall 65% from just a year ago.
