Fujitsu and Siemens discuss ending joint venture

Fujitsu is in talks to buy-out its partner Siemens from their computer maker joint venture Fujitsu Siemens Computers (FSC).

As IT PRO reported earlier this week, the joint venture looks set to come to an end. However, Fujitsu is believed to be unwilling to pay the price Siemens is asking, sources close to the matter said.

Analysts estimate FSC to have a value of around 1 billion (750 million).

The German-Japanese venture will be automatically extended from 2009 if neither partner gives notice this year that it wants to get out.

FSC employs around 10,500 worldwide, 6,200 of which are in Germany.

"We would like to continue with the business but only if the price is right," a company source said without elaborating.

Fujitsu was interested in the server segment, the memory system segment as well as the services business, which yields high margins.

A source close to Siemens said there was large interest in Siemens' stake and the company was not under pressure to sell at any price.

Siemens has also taken up talks with Fujitsu's Chinese rival Lenovo, according to company sources. Other groups such as Dell and Acer had signaled interest in growing their European market share.

It was therefore unlikely Siemens would consider buying Fujitsu's stake and selling the entire business. "We are negotiating because Siemens wants to sell," a company source in Japan said.

Siemens declined to comment but Siemens chief executive Peter Loescher has said in the past the venture was not profitable enough.

A Fujitsu spokesman would only confirm the two partners were in talks. "A decision has not been made," he said.