Acer to Buy Gateway for $710M

Stock jumps 50% following announcement
By Kevin Spak,  Newser Staff
Posted Aug 27, 2007 1:38 PM CDT
Acer to Buy Gateway for $710M
A Gateway computer is on display for retail sale at a Best Buy store in Los Angeles on Aug. 23, 2006. Based Irvine, Calif., Gateway, Inc. has recently implemented layoffs and cuts as it struggles with declining revenue and flat sales. (AP Photo/Reed Saxon)   (Associated Press)

(Newser) – Gateway’s stock jumped 50% today on news that Taiwan’s Acer will buy the former PC giant for $1.90 a share, MarketWatch reports. The acquisition leapfrogs Acer over Lenovo to the No. 3 spot in world computer sales. Meanwhile, Gateway said it will execute its right of first refusal to buy Packard Bell's parent company, foiling Lenovo's bid to acquire PB.

Though still a top seller in the US, Gateway has slid dramatically from its pre-tech-crash heyday, when it was worth an estimated $27 billion. Its second quarter US sales declined 7% from last year, compared to a 164% rise for Acer. Acer’s CEO says the deal completes the company's global footprint by increasing its US market share. (Read more Gateway stories.)

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