Irvine, Calif. — Gateway today acknowledged that on Aug. 3 it received an unsolicited offer from a shareholder to purchase the company’s retail operation.
Lap Shun (John) Hui, founder of eMachines and the second largest Gateway shareholder after Gateway’s founder Ted Waitt, has offered $450 million for the retail portion of Gateway’s business. Gateway purchased eMachines in 2004 from Hui. The deal as offered would leave Gateway with its direct and professional business intact, while removing the retail segment.
In a short, written statement Gateway said, “the Gateway board of directors will be reviewing the expression of interest with the help of its financial and legal advisors in accordance with its fiduciary obligations.”
At the same time the hedge fund Harbert Management Corp. grabbed 10.2 percent of Gateway's stock.
A company spokesman added that the board is expected to convene sometime on Aug. 23, but no further details were available.
Hui was highly critical of Gateway’s current operation. In a letter to Gateway CEO Rick Snyder dated Aug. 21 he said that he has been a patient shareholder, but has grown tired of having his suggestions on how to run the company ignored.
“The landscape of the PC business has continued to evolve rapidly and Gateway has not reacted. Gateway's stock price has continued to decline and the failure to name a replacement CEO for over six months has left Gateway in a position where it is unable to clearly and credibly articulate its strategic direction to the market,” Hui said.
Hui said the retail business was subsidizing the direct and professional segments and only by separating the two could either business reach its potential.
A Gateway spokesman said the company would not refute Hui's claims at this time.