Asustek to Merge with Gigabyte?

by Michael Lin — Monday, August 07, 2006, 10:00 AM EDT

DigiTimes reports this morning that some motherboard sources are indicating that Asustek might be preparing to merge and acquire the rival motherboard vendor Gigabyte. As the top-selling motherboard vendor, Asustek has been facing stiff competition from Foxconn and would be able to leverage the stronger distribution of Gigabyte to help ensure they remain on the top of Tier-I companies. To put things in perspective, the merger would grant Asustek an overwhelming 45% of the overall worldwide motherboard market. Then again, this is not the first time Gigabyte's name has been involved in merger rumors as we witnessed a similar rumor back in March where MSI was supposedly poised to acquire the company as well. Per usual, time will tell whether we'll see this merger go through or not.

"Asustek is aware of Foxconn's threat that comes from the EMS maker's large-scale financial support and intends to consolidate Gigabyte to secure its leading position in the motherboard industry, market sources observed. If Asustek merges with Gigabyte, the combined company's motherboard shipments may amount to 78 million units in 2006, the sources said. The merger will also help Asustek grab a 45% share of the worldwide motherboard market, by consolidating Gigabyte's strength in the distribution segment and enhancing its high-end portfolio in the own-brand business, the sources noted."

Tags: Asus, Gigabyte, Merge, Asustek, Mer, K

Asustek to Merge with Gigabyte?

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