Lenovo Group has agreed to buy a majority stake in Fujitsu Ltd’s PC unit for up to $269 million to corner a larger share of a market that is battling weak sales as more people switch to mobile devices.

Having lost the world’s largest PC maker crown to HP Inc this year, Lenovo has been looking for ways strengthen its core business. Weakness in this segment contributed to a profit decline over July-September, after pushing it into the red for the first time since 2015 in the previous quarter.

“PC is still core of Lenovo. It is still a very decent market ... commercial customers will still use PC,” Lenovo Chairman and CEO Yang Yuanqing said. “I think it is worth investing in this area.”

Lenovo said it would pay 17.85 billion yen ($156.70 million) in cash, and 2.55-12.75 billion yen based on performance to 2020, for a 51 per cent stake Fujitsu Client Computing Ltd.

Lenovo posted a profit of $139 million for the second quarter, versus $157 million a year ago. A taxation gain of $118 million helped earnings beat a consensus of $44 million. Its revenue was $11.8 billion ($11.2 billion).

Published on November 2, 2017