Asus, Gigabyte to form joint venture
This may not be Asus' rumored acquisition of Gigabyte, but the two
companies are joining forces. Asus and Gigabyte have announced the
creation of a joint venture that will produce motherboards and
graphics cards under the Gigabyte brand.
The Asustek-Gigabyte joint venture will be established with an initial
capital of NT$8 billion (US$244 million), with 51% of the company being
controlled by Gigabyte and 49% by Asustek. Under the agreement, the
chairman of the joint venture will be appointed by Gigabyte, as well as
three directors and one supervisor on the board of directors of the new
company. The remaining two seats on the company's board will be assigned
by Asustek, according to the companies.
The venture will begin operations on January 1, 2007. According to DigiTimes, the
extra capacity from Asus will let Gigabyte compete more effectively
against ECS and MSI. The creation of this joint venture may also be an
effort to prevent Foxconn from getting its hands on Gigabyte. Industry
sources claim Foxconn was looking to negotiate a merger, which could
have allowed it to overtake Asus in terms of motherboard shipments.