at the beginning of this year, IBM and lenovo group to reach an agreement to sell IBM low-end (X86) server business to lenovo, since the deal have been approved. But recent reports that, in view of the national security concerns, it deals may fail, at best, and only half of may, therefore, lenovo and IBM in recent days has been to the us government also applied for an extension of the merger review period, and the final purpose is to want to give the us government to approve the deal longer review time. Before due to the industry there are many analyses lenovo’s acquisition of IBM’s X86 servers, especially the deal for the world and the influence of Chinese server market, so, if lenovo acquisition IBM X86 server business not approved? Who is the trading of abortion winners and losers?
look at IBM in the first place. Look from the global server market, IBM two years has been in decline in market share and revenue, especially the X86 server business. IBM also will not to sell the business to lenovo. Only in lenovo announced earlier this year after the acquisition IBM X86 server business, HP the opportunity to grab the global server market a lot of the original IBM clients. For example, recently HP CEO Meg? Whitman said Meg Whitman, lenovo’s purchase of IBM X86 server business, HP will gain more profit, four months, HP has won more than 600 orders from IBM.
the reasons, such as the original IBM customers, lenovo acquisition of IBM’s X86 server business, which makes use of IBM server customers very panic, they don’t know IBM X86 server business going. HP high integration, software management ability, research and development spending, can take over the original IBM customers, so a lot of customers in consideration for HP. This situation, if IBM lenovo m&a transactions abortion, for IBM is probably a good thing, after all, the original stone down to the IBM customers, at least to slow the loss of the original customer, but IBM original predicament in the server market will not have big difference because of this, on the contrary, mergers and acquisitions that STH over and over again for the in the mind of the original IBM customers the negative impact of future for IBM server business impact? How big it’s very difficult to measure, but to be sure, lenovo merger IBM this matter, let’s ailing X86 IBM server business in the future developing added a variable.
look from the Chinese market, due to China’s rise last year of the so-called to the IOE and earlier this year, IBM decided to sell the X86 server business to lenovo, as well as the influence of the decline in its X86 server market share in China. According to Gartner’s latest statistics, in the first quarter of this year, IBM X86 servers in China’s market share fell 25%, the market share has plummeted from 18% to 11%, is China’s X86 server market in the top seven manufacturers the largest decline. Such a case, if trading terminated with lenovo, in addition to our above for the negative psychological impact of the customer, the future will be more in the Chinese market the rival lenovo (lenovo power is destined to enterprise business because it is over, but mergers and acquisitions, overseas market expansion blocked, but the onslaught of the Chinese market). Jilt his burden, but also to stimulate a rival, IBM in the Chinese market must be a loser.
now we need to know is, who is in the Chinese market due to IBM’s market share fell so serious? Who is divided up IBM’s market share? And thus lead to another server vendors.
is also Gartner statistics, in the first quarter, but the wave of Chinese server vendors market share growth is most significantly, the year-on-year growth of 288%, the market share jumped from 6% last year to 19% this year, the market also from 7 emerged as China is one of the oldest X86 server market. In contrast, other server vendors in China market share of the dawn, huawei, lenovo, in addition to the dawn rose one percent, slightly lenovo and huawei’s market share has not been change (huawei 16%; Lenovo’s 11%).
so, before the media coverage of the so-called China server vendors use to IOE rise, but the only real benefit from the largest and the most significant wave. But the second question is, if the IBM merger lenovo abortion, wave in lost to the IOE and lenovo acquisition IBM dual power transition, one of the IBM lenovo with m&a integration period continue to rob to users in the market, combined with the merger after the abortion, IBM original customer loss is bound to slow down, and lost after IBM lenovo in expanding overseas server market will increase after the road was blocked in China attack the server market (because lenovo and wave, almost all X86 server market’s centre of gravity in the Chinese market) of multiple factors, such as the wave of growth will also be like now so fast? The IBM merger abortion, seems linked to wave is not necessarily a good thing, say is a loser.
look at lenovo. As mentioned earlier, if the merger and acquisition of IBM server business failure, regardless of will therefore have to pay two hundred million dollars to IBM, it is important to its server market expanding abroad will become slim. From last year to the IOE agitation lenovo market share did not look up, overseas markets will be lenovo has the key to the future business growth. This is also why it try to acquisition of IBM’s server business. Also in the Chinese market, because of merger and acquisition, lenovo will also lose the opportunity to become China is one of the oldest X86 server market, and from the first quarter of the X86 servers in China market share, its only with IBM and HP for third place. There is no doubt that lenovo is also the failure loser of the deal.
the last is huawei, hewlett-packard and dell. Put together the three companies, because their server business oriented is the global market. Since is a global market, lenovo merger IBM deal if abortion, this wants to use lenovo merger integration of rob customers, even indirectly destroy a rival desire must be failed in X86 server market. Although HP during the recent use of lenovo and IBM transaction pending took part of IBM’s customers, and once the deal, just like our analysis above, the loss of original IBM customers will slow, HP (including other vendors) this playing time rob strategy effect will be weakened, even disappeared, and it remains to be seen, of course, what we have experienced before, after the merger with the original IBM customers significant negative impact on psychological and IBM X86 server for future business will continue to exist and develop confidence. So in overseas markets, trading of abortion for the three companies hardly pros and cons.
as for the three firms X86 servers in China market, the impact from the first quarter of last year to the first quarter of this year’s market share, in addition to HP, huawei and are beyond the IBM, dell, so to speak, they are rise last year to the second largest beneficiaries IOE. Is precisely based on this, they do not want to lenovo and IBM merger is successful, because once the merger is successful, even IBM customer loss again, plus the existing market share, lenovo the most conservative estimates, they will also be lenovo. Instead, let IBM X86 server business exist alone, so easy to break their opponents (lenovo and IBM).
what has been discussed above, we think, if lenovo acquisition IBM X86 server business finally an abortion, IBM and lenovo will be the biggest loser, followed by the wave; And huawei, HP and dell will be the winner. Manufacturer, once you make lenovo and IBM trading after the failure of response and development of the? In fact, the industry has been positive success (m&a) concerned about the pros and cons of mergers and acquisitions between enterprises and win or lose, actually together after a period of time travelling and twists and turns, but in the end, abortion, also there will be pros and cons and winning or losing, even before the industry’s competitive landscape will therefore change.