Lenovo has agreed to buy Brazilian consumer electronics maker CCE as the PC maker continues to plow resources into one of the world's largest emerging economies.
The world's second-largest PC maker by shipments, which has seen its Brazil, China, and India profits slow in the past couple of quarters, but is hoping the acquisition will boost its sales in the country, seen as a developing powerhouse for consumer electronics.
Founded in 1964, CCE eventually became Brazil's largest maker of consumer electronics, including VCR players, video games, micro-computers and refrigerators. In 2006, the firm created a new division, CCE Informatica, which produced PCs running low-cost versions of Windows and Linux.
Lenovo is expected to buy the firm for 300 million reais ($148m) subject to adjustments, in a mix of cash and stock. The deal could also include an additional 400 million reais ($198m) depending on performance over the next four years, ending December 2016.
The acquisition is expected to close in the first-quarter of 2013.
It comes only a fortnight after Lenovo said it would acquire Brazil consumer technology giant Digibras for approximately $147 million. The Brazil-based company has seven factories in the country. The buyout will aim to boost Lenovo's grasp of the smartphone and television markets in the country, where the firm has already made progress in producing locally built goods.
China-based Lenovo continues to push into Brazil, a crucial BRIC (Brazil, Russia, India, China) country, as the firm made clear in a press conference on Wednesday as the PC maker plays to invest $100 million in research and development in Brazil over the next five years.
In May, Lenovo's Asia-Pacific and Latin America president, Milko Van Duijl, told Dow Jones in an interview that the company was looking to set up its own permanent factories and units in Brazil in a bid to lower import costs and produce devices locally. In the process, the firm would boost the local economy and hire local workers.