Elitegroup, Pou Chen jointly muscle into IT distribution in mainland China

Taipei, Feb. 18, 2003 (CENS)--Taiwan's Elitegroup Computer Systems Co., Ltd. And the Pou Chen Group plan to jointly develop their computer distribution business in mainland China.

Elitegroup recently acquired a more than 80% stake in Beijing Speedy Creative Computer Co., Ltd., a leading information technology (IT) distributor in of mainland China, to serve as a distribution channel for products made by Elitegroup and other brands.

Speedy Creative was originally Elitegroup's dealer and general distributor in the mainland. The Taiwan IT conglomerate decided to increase its shareholding in the distributor to further strengthen its business deployment in the Eastern China market.

Through about 1,000 outlets under Speedy Creative's flag, Elitegroup sold over NT$10 billion (US$287.36 million at US$1:NT$34.8) worth of products last year in mainland China.


Elitegroup's board has also decided to invest in another IT distributor in Shanghai, but the project will not involve distribution outlets in the initial stage.

With the addition of the two distributors and the demonstration of its second-generation Desknote PCs, which pack desktop PC functionality in notebook sizes, Elitegroup expects to enjoy a booming business in the huge mainland market this year.

According to Elitegroup, Speedy Creative has outlets in eight major mainland cities and employs over 350 people.

Other Taiwan IT conglomerates have also been developing their IT distribution business in mainland China to expand sales there, including Hon Hai, Mitac, VIA, Compal, Clevo and BenQ (formerly Acer Communications & Multimedia Inc.)

Hon Hai and local partner Yam Digital Technology Co. invested in Cybermart, the second-largest 3C (computer, communication, and consumer electronics) distribution chain in mainland China last year by respectively acquiring a 60% and 30% stake in the company. Cybermart currently owns 50 distribution chain stores throughout mainland and is scheduled to become the largest IT distribution chain there this year. Hon Hai is the world's largest maker of barebone PCs and connectors, the fourth-largest motherboard maker, and the largest contract supplier of game consoles.

Compal, a leading notebook PC production conglomerate in Taiwan, last year set up a subsidiary in mainland China and plans to set up at least five stores there (in Beijing, Shanghai, Guangzhou, Chongqing and Shenyang) to distribute IT products made by it and other big international brands.

BenQ, which is already a well-established brad in the mainland, has self-built its product distribution network there by cooperating with local logistic service providers.

VIA has been trying to strengthen cooperation ties with IT distributors in the mainland. The company's chairman Wang Shueh-hong has personally invested in an IT distributor there to sell some Taiwan-made pocket PC models.

Mitac has opened many sales outlets in the mainland to sell Mitac brand IT products.

With an annual growth rate of at least 15%, the huge mainland China market has been a focal point for many leading international IT brands.