Should Dell Buy Acer? Something to Think About

[tiffany boggs]

With all the problems Dell has been having lately, this analysis comes as no shocker. Sanford Bernstein analyst, Toni Sacconaghi, laid out a plan for Dell to revive its fortunes by purchasing Acer. This would actually be a relatively cheap buy for Dell and the benefits may be well worth it.

A move like this could give Dell broader access to Asian and European customers where Acer does better, a stronger notebook line and a massive indirect sales channel. At the moment Dell does not sell in bricks and mortar retail stores, but Acer does, and this is something many analysts say Dell needs to move to doing.

I think customers need a change and maybe Michael Dell is now willing to back up Dell 2.0, which was designed to offer customers more of what they want (think "Dell, purely you" campaign). Whether customers want Advanced Micro Devices processors, improved product design, or Linux pre-installed options, Dell says it will offer them all.

They have already launched Dell Idea Storm, a website dedicated to users who want to leave feedback and opinions. The Tablet PC thread is getting lots of votes there and maybe if Dell ever does buy Acer, a Dell Tablet will be in the near future and not just a dream.

Buying Acer could be a quick fix for some of Dell's issues, according to Sacconaghi.

"A combined Dell-Acer would enjoy leading share in nearly every major region of the world, strong products in both the notebook and desktop segments, and far-reaching distribution through both direct and indirect channels."

"While we have no evidence that a Dell-Acer combination is being considered by either party, we do believe such a move could make strategic and financial sense," Sacconaghi wrote. "We believe Acer could help Dell address many of the challenges it currently faces, but would represent a significant departure from Dell's historical track record of acquisitions and from its 100 percent direct selling model."

Although there is no evidence of Dell and Acer combining, it is still a good insight. Sometime mergers benefit more people than they hurt, but sometimes they don't, I guess that is something both companies would have to consider if they take Toni Sacconaghi's advice.

Read More (The Register)

 

 

 

[Hezbollah]

Instead of buying acer, which dell (most likely will agree for a large some of money) looks forward to I think that there is a better solution. If Dell made a partnership with Acer so profits go 50-50. It would be cheaper on dell. It would also benefit us. Acers laptops getting a dell makeover. And dell getting an acer makeover (performance wise etc etc..)

[Andrew Baxter]

Dell shoulda bought Acer instead of Alienware, I'll say that much. One thing I know is that Acer accepts low margins on its PCs in order to get retail stores to try and push them more. I don't know if Mikey Dell would go for that. Overall I say there's no way this will happen, but Dell does need to do something about HP kicking their butts and eventually they'll have to sell in stores IMHO.

[sguart]

analyst doesn't care about the future of the company, they only see the short term stock price gain... they always suggest someone to buy somebody or to close some division out, and that seldomly works for the long term... that's what's wrong with wall street's view of any company, it's simply just a justification to its stock price... i think mikey cares a lot more about his company's future to let some analyst sway his decision...

dell doesn't gain much from buying up acer... they just need to change their way of assembling notebooks in house since that's the bulk of the sales of their business... they were caught in a transition period where their own way didn't work and they didn't switch to the new way. HP didn't switch anything, their old way didn't work before but it's working for them now.

dell also need to expand successfully into consumer electronics to help themselves weather the changes of the pc markets... they have not put enough thought into dell's consumer product... they always allow some oem to build some cheap product for them to put their name on it... which usually doesn't work cuz it doesn't differentiate itself from the rest of the products... also i think the strategy of xps being the premium brands is not helping them out much... they should open that part up to discount again and push for enthusiasts loyalty instead...

[Elminst]

Gah... That would suck... I actually like acer notebooks. I'd hate to see what Dell would do to them.

[Sam]

Well, people feared about Dell's takeover of Alienware. So far not much has changed for Alienware, except Dell's XPS has its resemblance to Alienware products . Oh, and Alienware's Homepage kind of looks like Dell's too now.

I think Dell seriously needs to rescue itself before it is obliterated into oblivion (hehe, I like that). Buying Acer's not a bad idea, they could profit in other strategies that they swore they would never undertake, like sell computers in big box stores like Best Buy. In that case, they would still make money selling Acers in Best Buy, while they still kept their 'rule' of not selling Dells through big box stores and resellers.

[yuio]

that would be stupid for dell and acer. acer is the 4th biggest computer manufacture world wide, it is going to cost a huge sum of money to buy them out. the only thing they would get out of it is huge channel network.

also, I like acer but don't like dell's, so my next system would be an HP then. so dell will not benifit from this at all because I will get a diffrent brand. and so will many other people.

Dell, my Advise Leave Acer Alone!!!!!!!!!!!!!!!!!

[link1313]

That would be a solid purchase, acer is strong in mainly stores only (especially in US). And they have a huge foothold in Europe and in Asia as well. All of these qualities Dell doesn't have. That would be a very smart move on Dell's part.

I actually didn't think Dell had the financial power to buy Acer.

[Sam]

I actually didn't think Dell had the financial power to buy Acer.

That's what I think too...Dell has around $10 billion cash in hand, which isn't even close to the size of Acer...

[JM]

I severely doubt that Dell has the kind of cash to buy Acer.

And I really don't think Acer investors would take Dell stock as an option.