Gateway Completes Acquisition of eMachines
March 11 2004 - 4:45PM
PR Newswire (US)
Gateway Completes Acquisition of eMachines POWAY and IRVINE,
Calif., March 11 /PRNewswire-FirstCall/ -- Gateway, Inc. announced
today that it has completed its acquisition of privately held
eMachines, one of the fastest-growing, most efficient PC companies
in the U.S., for 50 million shares of Gateway common stock and $30
million cash. (Logo:
http://www.newscom.com/cgi-bin/prnh/20020930/LAM050LOGO ) Following
the close of the acquisition today, which was initially announced
on Jan. 30, eMachines CEO Wayne Inouye was named CEO of Gateway,
succeeding Ted Waitt, who remains chairman and the company's
largest stockholder. Rod Sherwood continues to serve as the
company's CFO. "This is a great day for both Gateway and
eMachines," Mr. Waitt said. "While there is considerable work ahead
for us, I am confident that we will make fast progress at building
a successful, profitable and growing company." As Gateway works on
bringing the two organizations together, it will focus on expanding
its joint product line into new channels and markets and adopting
many elements of eMachines' highly efficient operating model.
Gateway will also benefit from increased scale. The company will be
the third-largest player in the U.S. PC market, with nearly 7%
ofthe U.S. PC market and more than 25% of the U.S. retail PC
market. It will also be the eighth-largest PC company in the world,
with growing sales in key international markets, including the UK,
Japan and western Europe. As a result, Gateway expects to return to
sustained profitability for 2005 as it benefits from increased
sales growth, new cost savings and other synergies. Mr. Inouye
said, "By offering the customer multiple brands through multiple
sales channels, Gateway will occupy a unique position in the
industry. This is a positive step for Gateway, its customers and
its stockholders. "We intend to get to work fast to solidify
Gateway's historical standing as the industry's most efficient and
competitive player, with a great reputation for quality and
reliability across our product line and among all our customer
segments," he added. As disclosed previously in a filing with the
U.S. Securities and Exchange Commission, Mr. Inouye's compensation
includes options to purchase 10 million shares of Gateway common
stock, issued at a per share exercise price of $5.19, which
represents today's closing price of Gateway shares. The options
will vest over the course of a back-loaded, four-year timeframe,
intended to encourage long-term retention, with a vesting schedule
of one-tenth, two-tenths, three-tenths and four-tenths of the
options over each of the next four years. In addition, 29 eMachines
employees in management roles have been granted a total of 2.4
million shares of Gateway stock upon their employment with the
company, subject to entering into a stockholders' agreement. The
2.4 million shares are included in the aggregate 50 million shares
issued by Gateway in the transaction. Gateway said it will give
further updates as appropriate on its progress on merger-related
decisions and actions. About Gateway Since its founding in 1985,
Gateway (NYSE:GTW) has been a technology and direct-marketing
pioneer, using its call centers, web site and retail network to
build direct customer relationships. As a branded integrator of
personalized technology solutions, Gateway offers consumers,
businesses and schools a wide range of thin TVs, digital cameras,
connected DVD players, enterprise systems and other products, which
work together seamlessly with its award-winning line of PCs. Its
products and services received nearly 130 awards and honors last
year. With its acquisition of eMachines now complete, Gateway is
the third largest PC company in the U.S. and among the top ten
worldwide. Visit http://www.gateway.com/ for more information.
Special Note This press release contains forward-looking statements
that involve risks and uncertainties, as well as assumptions that,
if they do not materialize or prove incorrect, could cause
Gateway's results to differ materially from those expressed or
implied by such forward-looking statements. All forward-looking
information related to results is subject to finalization of
results, including appropriate adjustments to returns and
inventory, and completion of its year-end audit. All statements,
other than statements of historical fact, are statements that could
be forward-looking statements, including any projections or
preliminary estimates of future financial and operating
performance; any statements of plans, strategies and objectives of
management for future operations; any statements regarding proposed
new products, services or developments; statements of belief and
any statement of assumptions underlying any of the foregoing. The
risks that contribute to the uncertain nature of these statements
include, among others, the risk that the businesses will not be
integrated successfully to achieve the expected results; disruption
from the merger that could adversely impact relationships with
customers, suppliers and employees; competitive factors and pricing
pressures, including the impact of aggressive pricing cuts by
larger competitors; general conditions in the personal computing
industry, including changes in overall demand and average selling
prices, shifts from desktops to mobile computing products and
information appliances and the impact of new microprocessors and
operating software; the ability to transform the company to a
technology solutions provider and restructure its operations and
cost structure; component supply shortages; short product cycles;
the ability to access new technology; infrastructure requirements;
risks of international business; foreign currency fluctuations;
ability to grow in e-commerce; risks of minority equity
investments; risks relating to new or acquired businesses, joint
ventures and strategic alliances; risks related to financing
customer orders; changes in accounting rules; the impact of
litigation and government regulation generally; inventory risks due
to shifts in market demand; changes in product, customer or
geographic sales mix; the impact of employee reductions and
management changes and additions; and general economic conditions,
and other risks described from time to time in Gateway's Securities
and Exchange Commission periodic reports and filings. Gateway
assumes no obligation to update any forward-looking statements to
reflect events that occur or circumstances that exist after the
date on which they were made.
http://www.newscom.com/cgi-bin/prnh/20020930/LAM050LOGO
http://photoarchive.ap.org/ DATASOURCE: Gateway, Inc. CONTACT: Bob
Sherbin of Gateway, Inc., +1-858-848-3886, Web site:
http://www.gateway.com/
Copyright
Gateway (NYSE:GTW)
Historical Stock Chart
From Jun 2024 to Jul 2024
Gateway (NYSE:GTW)
Historical Stock Chart
From Jul 2023 to Jul 2024