NEC

Credit Suisse introduced NEC technology to Lenovo computing. Sparks flew. 

About the partnership between Credit Suisse and NEC

Ever since its launch as the Nippon Electric Company in July 1899, NEC has been at the forefront of the developing world of technology.

From its advances in the way switchboards could be used for long distance calls in 1919, to Japan's first domestically produced automatic phone exchange in 1927, many of NEC's early innovations were in the field of telecommunications.

Then in 1954, the company began its first forays into the emerging world of computers.

And 20 or so years later, NEC's president made the bold prediction that one day, computers and communications would be integrated. A statement that proved to be as accurate as it was ahead of its time.

Today, the name NEC remains synonymous with innovation and advances in technology, and Credit Suisse is helping keep them at the forefront, by helping shape their corporate strategy and, most recently, orchestrating the merger that makes NEC and Lenovo the fourth-largest computer manufacturer in the world.

65,000

patents owned by NEC worldwide, including approximately a third of these held in Japan

Nec Quote

Today, the name NEC remains synonymous with innovation and advances in technology, and Credit Suisse is helping keep them at the forefront.

A blueprint for future M&A activities between Japan and China

Credit Suisse has advised NEC on their overall corporate strategy, not only on merger and acquisition (M&A) discussions, but also on other financing activities. Most notably, Credit Suisse has been continuously discussing their business portfolio strategies from an M&A point of view (divestitures and acquisitions). Credit Suisse has also maintained a close relationship with NEC for over 10 years. 

Results:

Credit Suisse successfully executed the complex joint venture deal with Lenovo and achieved a higher transaction multiple enterprise-value-to-revenue (EV/Revenue) compared to Lenovo’s acquisition of IBM’s PC business in 2004. The transaction gave NEC and Lenovo the leading market share in both China and Japan, which are two of the three largest PC markets in the world, behind the US.

The NEC-Lenovo joint venture maintains a solid customer base in Japan where it remains a leader in PCs with  25 percent share of the market in 2012 aiming for 30 percent.

Results:

Credit Suisse successfully executed the complex deal and achieved higher transaction multiple (EV/Revenue) compared to Lenovo’s largest acquisition of IBM’s PC business in 2004.

The transaction gave NEC and Lenovo the No.1 market share in China and Japan which are 2 of the 3 largest PC markets in the world.

Results:

Credit Suisse successfully executed the complex deal and achieved higher transaction multiple (EV/Revenue) compared to Lenovo’s largest acquisition of IBM’s PC business in 2004.

The transaction gave NEC and Lenovo the No.1 market share in China and Japan which are 2 of the 3 largest PC markets in the world.

NEC maintain a solid customer base in Japan where it remains a leader in PCs with 19% of the market in CY2010 3Q. 

Following its operations realignment including semi-conductor etc, NEC is now looking at the global expansion of its information technology business. 

Lenovo has benefited considerably from the explosive growth of China's PC market in recent years and has roughly 27% of its home market. 

Critically, the NEC-Lenovo JV was a milestone transaction proposing a new approach for Japanese companies suffering from a matured domestic market and commoditized products.