The personal computer industry may be ripe for a wave of consolidation, with a marriage of Dell Inc and Acer Inc seen as a particularly smart deal, according to an influential Wall Street analyst.
"Among the 10 top PC vendors, we believe that a Dell/Acer combination makes the most sense," Sanford C. Bernstein & Co analyst Toni Sacconaghi said in a client note on Friday.
If Dell were to buy Acer for a 20 percent premium, or about $5.7 billion, it would boost Dell's annual revenue growth sharply and add 12 cents a share to annual profit, he said.
The PC industry is commoditized and remains fragmented. Consolidating could help companies score better pricing from component vendors and contract manufacturers, as well as cost savings in areas such as human resources, he said.
"We view PC vendors as analogous to retailers, where our research suggests that the largest and operationally most efficient have garnered outsized profits relative to their peers," Sacconaghi wrote in his report.
Acer has a strong share of the portable computer market outside the United States, which would provide Dell with exposure to faster growth markets, he added.
Sacconaghi said buying Acer might also be beneficial to top PC maker Hewlett-Packard Co, but not as much as it would to Dell.
"While an HP-Acer combination might provide similar scale and synergy benefits, end market complementarity would not be as high," he said.
According to research firm Gartner, Dell and Acer were in a virtual tie for second place in the first quarter in market share in the United States.
Agencies
Showing posts with label Consolidation. Show all posts
Showing posts with label Consolidation. Show all posts
Monday, May 4, 2009
Friday, December 19, 2008
Consolidation, BC, Virtualization Top the CIO List
A survey commissioned by HP said that majority of technology decision makers are currently implementing or planning to implement in 2009 consolidation (95 percent), business continuity (93 percent) and virtualization (91 percent) projects.
Today s CIOs are challenged to control costs and achieve returns on technology investments. According to the study, respondents named reducing operational costs (31 percent) as their top driver for 2009 DCT spending. Enhancing security (29 percent) followed as a close second.
However, in both cases decision makers said that technology needs, more than business needs, are prompting the investments. This may limit their ability to achieve both short-term and long-term business benefits such as reduced costs, mitigated risks and accelerated growth.
CIOs who approach DCT initiatives with a focus on business needs can significantly reduce time to value for today s technology investments while laying the foundation for future growth, said John Bennett, worldwide director, Data Center Transformation Solutions, HP.
Most organizations are transforming their data centers through independent projects instead of taking a broad, integrated approach. The new research indicates that 20 percent of technology decision makers are initiating a complete transformation, while the remaining 80 percent are implementing individual transformation projects without an overall DCT strategy.
When asked to indicate what projects they would implement independently to achieve specific technology goals, respondents named the following:
# Automation 64 percent
# Green IT 60 percent
# Operations management 59 percent
# Virtualization 59 percent
# Business continuity 58 percent
All of these projects have the potential to also achieve business goals. By taking a comprehensive approach and aligning these autonomous projects to an overall DCT strategy, an opportunity exists for CIOs to maximize the value of their transformation initiatives, the survey said.
Today s CIOs are challenged to control costs and achieve returns on technology investments. According to the study, respondents named reducing operational costs (31 percent) as their top driver for 2009 DCT spending. Enhancing security (29 percent) followed as a close second.
However, in both cases decision makers said that technology needs, more than business needs, are prompting the investments. This may limit their ability to achieve both short-term and long-term business benefits such as reduced costs, mitigated risks and accelerated growth.
CIOs who approach DCT initiatives with a focus on business needs can significantly reduce time to value for today s technology investments while laying the foundation for future growth, said John Bennett, worldwide director, Data Center Transformation Solutions, HP.
Most organizations are transforming their data centers through independent projects instead of taking a broad, integrated approach. The new research indicates that 20 percent of technology decision makers are initiating a complete transformation, while the remaining 80 percent are implementing individual transformation projects without an overall DCT strategy.
When asked to indicate what projects they would implement independently to achieve specific technology goals, respondents named the following:
# Automation 64 percent
# Green IT 60 percent
# Operations management 59 percent
# Virtualization 59 percent
# Business continuity 58 percent
All of these projects have the potential to also achieve business goals. By taking a comprehensive approach and aligning these autonomous projects to an overall DCT strategy, an opportunity exists for CIOs to maximize the value of their transformation initiatives, the survey said.
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