On 8 December 2004, when Lenovo announced its decision to acquire IBM PC Division, the IT Industry and business community were shocked. It was a smaller Chinese company from a developing country that acquired a larger American company from the most industrialized economy in the world. Most people thought that this acquisition was destined to fail, and the acquisition was compared to 'a snake swallowing an elephant'. There are three types of risk - employee risk, market risk and cultural integration risk associated with the acquisition. This paper analyses how Lenovo manages these risks.
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