Legend Plans to Catch Falling Dotcom FirmsLegend Group, China's biggest computer vendor, is planning to grasp the opportunity of the dotcom sector's tumble and further invest in the Internet industry, according to a senior official of the firm."We will increase the original planned investment of HK$800 million (US$102.56 million) to dotcoms as they are very cheap now," said Liu Chuanzhi, chairman of the Legend. Liu said another acquisition would be announced before the end of the year, according to report by chinadaily.com.cn. Legend accumulated HK$2 billion (US$256 million) via a share placement in the first half of this year and has designated 40 per cent of the money to be invested in dotcoms. The firm acquired stock trading website www.yestock.com several months ago, but the acquisition was called "not a good buy" as dotcom shares nosedived shortly after. "We can't miss this opportunity," Liu said, "There are many real buys in the market." Legend started to show interests in the Internet last year and launched its own portal www.FM365.com last April. "The website lost HK$40 million (US$5.13 million) in the first half year," Liu said, "But it helped the sales of consumer PCs." The latest company statistics show Legend with a revenue of HK$13.09 billion (US$1.68 billion). The group earned HK$408 million (US$52.31 million) in the first half of the year which is a 135.3 per cent increase compared with the same period of last year. Investment bank Goldman Sachs said Legend's September-quarter domestic PC market share increased to 30 per cent from 26 per cent in the June quarter. Legend now reportedly has a 40 per cent share in China's consumer PC market. Small and medium-sized enterprises are to be Legend's next growth engine, the bank said in a statement. "Penetration into this market remains low, and the potential market opportunity to sell higher margin products such as network equipment and servers along with incremental value-added services is large," the statement said. Legend has continued to deepen its reach into the market and has expanded its PC sales channel by increasing the number of distributors to 3,200 from 2,000. The firm also has 158 PC specialty shops. "We made promotion movements in 600 cities this year, that is what our international rivals IBM, HP and Compaq can't compare with," Liu said. Besides investing in dotcoms, Legend is also planning to set up a venture capital branch early next year. |
| People's Daily Online --- http://english.peopledaily.com.cn/ |