- Is the reader aware that the Red China company Lenovo
has purchased the IBM Personal Computer division for $1.75 billion dollars
in cash and stock equity? It is no wonder why they wanted to keep this
corporate takeover relatively quiet. Yet another American company has been
taken over by a corporation from Red China -- a corporation that is partly
owned and controlled by the Chinese government. This story, which has MAJOR
implications to the continuing technology transfers from the USA to Red
China, has not been given much exposure in the controlled and heavily-censored
American mainstream news media.
- Red China has nearly defeated America by economic means,
and not a single shot has ever been fired. Those in the know keep hearing
about Red China's standing military of 200 million strong -- which is approximately
two-thirds of the total population of the USA. China is kicking American
ass -- and they are doing it by purely economic means. No armies have been
deployed, and if our nation continues down the current road we are presently
on -- Red China will completely defeat America by means of what I might
call 'economic strangulation.'
- It is beginning to appear that America is being destroyed
from within ON PURPOSE -- and if this IS indeed the case -- then those
in Washington, DC who are helping this to happen either through myopic
monetary and trade policy or through their own failure to act to protect
American national security -- are committing treason and should be immediately
arrested and taken into custody.
- In an article for Information Week, the following was
mentioned about the national security concerns and the potential transfer
of sensitive technology from the USA to Red China that could have occurred
because of this corporate takeover:
- "While IBM and Lenovo officials can now look forward
to making Lenovo a global PC giant, the deal wasn't without its hitches.
Some U.S. lawmakers expressed concerns that it would result in the transfer
of sensitive technology to a communist-led country that some consider a
political and economic rival to the United States. Nonetheless, the Committee
on Foreign Investments in the United States, which is attached to the Treasury
Department, gave the deal the green light in March after reviewing its
national-security implications. At the time, a source close to the deal
said IBM and Lenovo had to make some 'minor modifications' to the agreement
to win federal approval. For instance, Lenovo employees working at IBM's
manufacturing and design facility in Raleigh, N.C., must be housed in a
separate building on the campus," the source said.
- As the above quote points out -- this transaction was
approved in spite of obvious national-security implications. While it may
not result in the transfer of sensitive military technology -- there are
economic implications here -- as the IBM personal computer division is
a multi-billion dollar company unto its own. While the IBM-Lenovo co-headquarters
will be located in both the USA and in Red China -- the profits of still
another large global American corporation will be forever taken off-shore
and away from America.
- Here are some of the details of this corporate takeover:
- * Creates third largest PC business with $12 billion
combined annual sales (2003 fiscal year).
- * With IBM buyout, Lenovo quadruples their annual sales
on 11.9 million units sold.
- * New marketplace encompassing 160 countries, for a true
- * IBM will now outsource all PC's to Lenovo, with IBM
handling customer credit side of business.
- * IBM takes an 18.9 percent ownership stake in Lenovo.
- * Founded in 1984, Lenovo brought the PC to Red China,
and since 1997, has been leading PC brand in Red China and Asia.
- * Lenovo had $3 billion dollars in sales in 2003, and
IBM had sales of $9 billion of sales in that same year.
- As the reader can tell by the list above, the Lenovo
transaction is an extremely unusual situation. It is quite literally, a
small fish devouring a larger fish, as IBM is three-times the size of Lenovo,
in terms of sales volume alone. A company with $3 billion dollars in sales
is usually purchased by the company with $9 billion dollars in sales --
and not the other way around. Here, the smaller company bought the larger
company -- and this raises some red-flags -- leading me to wonder what
is really going on here? "We were simply finding a boss for ourselves,"
said Mary Ma, Lenovo's Chief Financial Officer.
- Why is ANYONE in the United States allowing a Red China
corporation to purchase an American company three-times larger than itself?
The article in WIRED magazine called this an "unprecedented union
of [Red] China's biggest information technology company and an American
institution..." and also points out that the acquisition moves Lenovo
from the world's ninth-largest personal computer manufacturer, to the third
-- behind Dell and Hewlett-Packard, respectively. This is the spot previously
held by IBM, which as a company isn't gaining nearly as much as Lenovo
-- a foothold in the American technology sector.
- The WIRED article also points out that "there's
more afoot here than the sale of an American icon to Chinese owners. The
purchase creates the first truly globalized -- as opposed to global --
corporation. [ ... ] It's a confluence of forces -- innovation, technology,
and free markets -- that makes this moment possible. Isn't this exactly
the kind of IBM Thomas Watson Sr., who in the 1930's pitched world peace
through world trade,' would have wanted for the 21st century? Is this what
globalization hath wrought?" [WIRED pg. 144]
- Lenovo chose IBM's Steve Ward to become its' next CEO,
and SONY did the same earlier in 2005, when they named Howard Stringer
as their first-ever non Japanese Chairman and CEO. This is the business
world under the regime of globalization -- American business executives
training and mentoring their own Red Chinese counterparts as the formerly
American company now works against the U.S. -- the very country to which
they are supposed to harbor some allegiance.
- Some might wish to think that this $12 billion dollars
is only a small portion of IBM's annual sales of $96.3 billion dollars
-- but this fact does not matter much when set against the 'bigger picture.'
The anti-trust and the national-security personnel that examined this deal
for the U.S. Government have set a dangerous precedent by approving this
- I expect to see further deals of this nature -- with
larger amounts of shareholder equity flowing permanently out of the USA
and into Red China.
- The deal starts to make sense when one discovers that
twenty-eight percent of Lenovo is owned by the Red China government. Could
this be an act of economic war against the USA by Red China itself?
- Here are some of the ways in which the Lenovo deal harms
the United States:
- * Red China communist government owns 28% stake in Lenovo.
- * Pre-buyout 33% of IBM employees were based in the U.S.
Post buyout, it fell to only 17% based in the U.S.
- * IBM loses half of their employees who were formerly
based in the USA, about 10,000 jobs total.
- * IBM's revenue per employee falls from $1,279,400 to
- * Red China government-backed company operates in America
at New York co-headquarters.
- * IBM PC unit with $9 billion dollars in annual revenue
in 2003 is sold for rock-bottom price of $1.8 billion dollars.
- The takeover of IBM's PC manufacturing business is similar
to the $3.4 billion dollar corporate takeover by SONY Corporation of Columbia
Pictures Entertainment (and all subsidiaries) on November 7, 1989. Will
another company, in the future, be hijacked in a similar manner? I would
have to say, that yes it will happen again. America will come to suffer
Red China's 'death of a thousand cuts' -- and whether we as a nation will
survive is anyone's guess.
- The signs and symptoms of the situation seem to indicate
that we are ALREADY at war with Red China -- and the basis of this war
is economic in nature. We have run up an outrageous trade deficit that
is largely due to one single nation. We import all matter of cheap and
inexpensive goods -- at the expense of the careers and livelihoods of millions
upon millions of American citizens -- who now work at a local fast food
restaurant because their factory job was relocated to Mexico or Red China.
- The only solution to this mess in which we currently
find ourselves is NOT to purchase goods and/or services from companies
like Lenovo-IBM, WAL-MART, and others like them. There still are a few
good and honest businesses left -- and it is THEY who deserve our patronage.
Why continue to line the pockets of TRILLIONAIRES -- such as when one shops
at WAL-MART -- when you can rest your conscience and shop at one of the
few remaining honest businesses that can be found? This is a war -- and
during times of immense struggle -- the idea should be to support your
allies and protest your enemies by refusing to patronize their businesses.
While it is certainly true that things cost more at the smaller but honest
business -- however I would much rather patronize that honest business
than to place my money with some business who is using the profits from
my purchases to DESTROY the land that I love so much.
- IBM Press Release - 'Lenovo To Acquire IBM Personal Computing
Division,' December 7, 2004
- Maney, Kevin - 'The New Face of IBM,' WIRED July 2005,
- McDougall, Paul - IBM Completes Sale of PC Business To
Lenovo,' Information Week, May 2, 2005
- WIRED News Report - 'IBM Deal Gets Green Light,' March
- © 2005 Kentroversy