Lenovo Group buys stake in PCCW's digital units for $614 mln

Pccw

14/06/2022 16:36

June 14 (Reuters) - China's Lenovo Group  0992.HK  will buy
stakes in two units of investment holding firm PCCW Ltd
 0008.HK  for a combined $613.6 million in cash and stock, the
world's largest maker of personal computers said on Tuesday.
    The company will buy an 80% stake in Digital Era Enterprises
and a 20% stake in PCCW Network Services, a holding company for
a unit that provides technology solutions to government entities
in Hong Kong.
    "The transaction allows the company to expand its IT
services capabilities, its suite of service offerings as well as
the geographic and vertical coverage of customers and partners,"
Lenovo said https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0614/2022061401145.pdf.
    The company, which last month warned of a hit to shipments
in the short term due to China's COVID-19 lockdowns exacerbating
chip shortages, will pay PCCW $513.6 million in cash and issue
86.4 million shares at HK$9.025 a piece. Lenovo's shares closed
at HK$7.57 on Tuesday.  urn:newsml:reuters.com:*:nL2N2XI06C
    PCCW anticipates a gain of $100 million from the disposal,
it said in a separate filing https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0614/2022061401137.pdf,
 adding it will use the proceeds to invest in growth areas and
to repay debt, among others. 

 (Reporting by Sameer Manekar in Bengaluru)
 ((Sameer.Manekar@thomsonreuters.com; Twitter: https://twitter.com/sameer_manekar))