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Foxconn rumored to buy Pegatron
INTERESTING MOVES ARE rumored to be afoot in the Taiwanese OEM/ODM business. The whispers this time around are that Foxconn is going to be snapping up Pegatron.
You might recall that about a year ago, Asus split up into three parts, Asus, Pegatron and Unihan. Asus makes the branded PC and things you can buy, Pegatron is the OEM business, and Unihan is everything else. The splits are along fairly clean lines, and make a fair bit of sense.
The rumors flying around old Taipei is that Foxconn is going to grab Pegatron, making a seriously huge OEM/ODM monster. There is a catch however: the rumor says that Asus won't let it go to Foxconn unless Foxconn drops its channel/retail business. If you think about it, that deal plays to the strengths of both sides. Asus is a channel master, and Foxconn will elicit a heart felt 'who?' from most computer shoppers, but makes most of the things they purchase.
The birds in the trees in Old Taipei are pegging one of two dates for this to happen, the end of Q4, IE in just over a month, and the beginning of Q2/09. Foxconn has previously given the channel business six months to make a profit or be shuttered, so that could be the public excuse.
In any case, if this rumor turns out to be true, we could see a massive change in how PC components are made and sold.
Won't that make for an interesting Computex this year? ยต
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So thats "rumoured" and NOT "rumored" We invented English, don't allow it to poisoned.....
For a second, I thought it said Pentagon. Scary!
"Asus" used to be "Pegasus" until they ditched the "Peg" and kept the rest. Apparently they found use for the "Peg" and invented "Peg-atron", but once again they're dumping it. Not even the great Al Bundy hated Peg so much. Foxconn will end up making components for almost every motherboard in the world - talk about monopoly anyone?
It already is almost a monopoloy for Hon Hai - nothing will change there. Between Hon Hai & AMP the market is mostly sewn anyways so its not anti-competitive in that way. Remember that Pegatron isn't strictly ATX and BTX derived business anyway - there's many and plenty contracts besides pumped out by these divisions that are any layout or co-layout with IC's and high density SMT's.
If foxconn grabs up an oem and has to relinquish its product name, wouldn't it make sense for ASUS to essentially buy the foxconn brandname and share the slowing markets? It will be interesting to see how this one plays out. Thanks charlie.
The problem with monopoly is that we suffer in the final run... decrease in competition always leads to increase in price and decrease of quality