NEC, China's Lenovo in talks on PC partnership

NEC Corp. and China's Lenovo Group are discussing a possible tie-up in the personal computer business, it was learned Friday.

Lenovo is considering investing in NEC Personal Products, an NEC subsidiary that makes PCs, sources said. If realized, it will be the first full business partnership between leading Japanese and Chinese information innovation companies.

The tie-up with Lenovo

NEC expects the tie-up with Lenovo would help it cut costs in its PC division so it can concentrate management resources on its communications business and cloud computing, in which users use Internet-based software, according to the sources.

Observers said furthermore reorganization of computer companies is highly possible, as the market has become incredibly competitive due to the price war and challenges from tablet PCs and smart phones.