CHINESE personal computers maker Lenovo Group is acquiring stakes worth US$614 million in two digital units of Hong Kong telecoms firm PCCW Ltd., betting that a post-COVID recovery and hybrid work model will drive IT services demand.

Lenovo, the world’s largest maker of personal computers, said in a statement late Tuesday it will buy an 80% stake in Digital Era Enterprises and a 20% stake in PCCW Network Services, a holding company for a unit that provides technology solutions to government entities in Hong Kong.

The deals would diversify its businesses and were important for the company’s long-term development, Lenovo said.

“The transaction allows the company to expand its IT services capabilities, its suite of service offerings as well as the geographic and vertical coverage of customers and partners,” it said.

Lenovo, which last month warned of a hit to shipments in the short term due to China’s COVID-19 lockdowns exacerbating chip shortages, will pay PCCW US$513.6 million in cash and issue 86.4 million new shares, or a 0.71% stake.

PCCW, controlled by Hong Kong tycoon Richard Li, anticipates a gain of US$100 million from the disposal. (SD-Agencies)