Lenovo maps merger plans for Asia

The new Lenovo Group plans to apply China's "one country, two systems" political philosophy to its mainland subsidiaries.

Even after merging its PC business with IBM's Personal Computing Division, Lenovo will continue to operate as two separate entities in the country, said Andrew Sotiropoulos, currently the vice president of Big Blue's PCD operations in the Asia-Pacific region. Sydney, Australia-based Sotiropoulos has been appointed the new regional head for Lenovo International, the group tasked to handle the company's business outside China.

"Lenovo in China today sells PC products, Intel servers, printers and mobile handsets. That organization, as a company, will continue to run separate to the Lenovo International group," he said, adding that this arm will report directly to Stephen Ward--the soon-to-be chief executive of the new Lenovo, until further plans are confirmed in 2006.

"The Lenovo International component, which is IBM's old PC division, even within Greater China, will continue to report to me," Sotiropoulos told CNETAsia.

About 10,000 IBM employees globally are expected to be on the payroll of Lenovo International when the merger is completed in June. IBM declined to specify the number of workers who will be impacted across its 18 markets in Asia-Pacific, but Sotiropoulos stressed that there will be no redundancy as a result of the transition.

"We're in a wonderful position here because Lenovo is new everywhere for us. The Lenovo Australia executives and employees are simply changing company titles," he said. "There is no Lenovo organization in Australia or anywhere else except China."

Plans to extend Lenovo's offerings beyond China will also be finalized by the end of the second quarter, Sotiropoulos added.

Upon completion of its $1.75 million deal with IBM, Lenovo will become the third-largest PC maker in the world, behind Dell and Hewlett-Packard.

Winston Chai of CNETAsia reported from Singapore.