NEC Corp. announced Thursday that it will increase its support and control over Packard Bell NEC, Inc. in the United States by providing loans and sending an additional director from NEC.
To strengthen its financial status, NEC will provide loans worth $300 million, with France-based Cie. des Machines Bull, another major shareholder of PB NEC, guaranteeing 20 percent of the total. In return, NEC's ownership of PB NEC's preferred stock with voting rights has increased from 19.84 percent to 49 percent, the company said.
NEC's current shareholding ratio of 51.08 percent, however, is unchanged, according to the company. The directors on PB NEC's board from NEC were also increased from two to three, while the number of directors from the original firm was reduced from five to four.
The U.S. company was created in July 1996 after the former Packard Bell Electronics accepted investment from NEC and Cie. des Machines Bull. NEC, which seeks to maintain a stable share of 10 percent in the world's personal computer market, merged its international PC operations outside China and Japan with PB. PB NEC is reportedly operating in the red, but NEC declined to disclosed the figure because the company is unlisted.
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