Lenovo May Take New IoT Device Company Public
The vendor's CEO tells Bloomberg that the new company could be worth $2 billion when it starts selling smartphones and devices April 1.Lenovo officials throughout 2014 moved quickly to expand the company's computing capabilities beyond its market-leading PC business, spending almost $5 billion to acquire IBM's x86 server business and Motorola Mobility from Google. In October, company officials announced it was creating a new company that will build smart devices for the Internet of things (IoT). Now executives reportedly are considering taking the new company—called Shenqi—public sometime after it opens for business April 1. Lenovo CEO Yang Yuanqing told Bloomberg this week that the new company will sell its own branded smartphones as well as smart connected devices for the home online, rather than through carriers and retailers as Lenovo does. "We want to build a pure Internet-oriented model," Yang told Bloomberg, adding that trying to make such a move within Lenovo would cause it to directly compete with its various channel and carrier partners. "We want to try a new way to nurture and incubate business."
Shenqi will get money from Lenovo as well as "capital markets," the CEO said, adding that the company could be worth a "couple of billion dollars" once it starts selling products. Chen Xudong, president of Lenovo’s China geography and Asia Pacific—Emerging Markets, will become the new company's CEO.