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Asustek Computer and Gigabyte Technologies on Tuesday announced that the two leading makers of computer components form a joint-venture that will produce hardware under Gigabyte brand-name. So far no official information is available at first hand in Europe or the U.S., however, several Asia-based media have reported numerous details on the newly formed company.

The initial capital of the joint venture will be NT$8 billion (Taiwanese dollars), which is about $243.3 million or ?189.69. Gigabyte will have 51% of the company and will receive chairman of the board position along with 3 seats in the director’s board, while Asustek will have 49% stake in the yet unnamed joint-venture and two seats in the board. The new company will supply mainboards and graphics cards under Gigabyte brand-name starting from the 1st of January, 2007.

At this point it is unclear whether the two companies will invest cash, or other assets into the newly formed joint venture.

There is currently no information what is going to happen to Asustek’s own-brand devices and appropriate business, just as it is unclear whether the move fits into Asus’ strategy to diversify in two branches: one focused on contract manufacturing, another dedicated to developing and selling products under “Asus” trade-mark.

The deal, however, is likely to create a strong player in the field of print circuit boards-based devices, such as mainboards or graphics cards, which will pose extremely serious competition to Foxconn, which has been gaining strength in the most-recent years, particularly in the channel market.

The news-story may be updated as more details from official sources are available.


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