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Lenovo Group Ltd. (992), the world’s second- biggest maker of personal computers, said it will invest 5 billion yuan ($792 million) to set up a plant to research and produce mobile devices such as smartphones and tablet computers.
The plant in Wuhan, China, will open in October 2013 and create 10,000 jobs, Lenovo said in a statement today. The plant will generate sales of 10 billion yuan by 2014 and that will rise to 50 billion yuan within five years, the company said.
The Chinese company, which bought the personal computer division of International Business Machines Corp. in 2005, is diversifying into tablets and smartphones under Chief Executive Officer Yang Yuanqing to compete with Apple Inc. (AAPL), which dominates the global tablet market with its iPad.
Lenovo, with headquarters in Beijing and North Carolina, had 13.4 percent of the global PC market in the first quarter, trailing Hewlett-Packard Co. (HPQ)’s 18 percent, according to data from researcher IDC. Apple leads the world in tablets with 68 percent market share in the quarter, according to IDC.
Lenovo fell 2 percent to HK$7.51 at 9:50 a.m. in trading on the Hong Kong stock exchange. The shares have gained 45 percent this year, compared with a 12 percent advance in the benchmark Hang Seng Index.
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