In December 2004, China's largest Computer maker, Lenovo Group Ltd., acquired an 81.1% stake in IBM PC division. This deal has made Lenovo the third-largest PC maker in the world, behind Dell and HP. Lenovo, formerly known as Legend, was established in 1984 as a distributor of IT products. Over the years, it started its own PC business and achieved numero uno position in the domestic market with a 26% market share. This deal was a next step to achieve its commitment to go global by developing market worldwide. This deal will enhance its market share, technical know-how, international reach and brand equity. However, experts feel that IBM may lose its customers and face challenges in managing the business. Since, IBM has extensive international experience and a unique culture of managing business that goes back to the 50s and 60s. Whereas, Lenovo has a unique culture and the way both companies reach decisions is entirely different. The biggest challenge before the new organization is creating a new business culture. However, experts feel that merger and consolidation activity will take place in the near future despite these challenges. To share their perceptions on merged entity and their strategic imperatives behind this deal, The Analyst invited Cyrus Kanga, Associate, Corporate and Investor Relations, Ogilvy Public Relations Worldwide, China; Martin Gilliland, Principal Analyst, Gartner Asia Pacific; Rob Enderle, Principal Analyst, Enderle Group; Marshall W Meyer, Professor of Management and Sociology, Department of Management, The Wharton School, University of Pennsylvania.

Lenovo, formerly known as Legend, was established in 1984 as a distributor of IT products. Over the years, it started its own PC business and achieved numero uno position in the domestic market with a 26% market share. This deal was a next step to achieve its commitment to go global by developing market worldwide. This deal will enhance its market share, technical know-how, international reach and brand equity. However, experts feel that IBM may lose its customers and face challenges in managing the business. Since, IBM has extensive international experience and a unique culture of managing business that goes back to the 50s and 60s. Whereas, Lenovo has a unique culture and the way both companies reach decisions is entirely different. The biggest challenge before the new organization is creating a new business culture. However, experts feel that merger and consolidation activity will take place in the near future despite these challenges.