What if ASUS buys into Gigabyte

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We reported about a possible buy into or merger of ASUS and Gigabyte, two of the top tier mainboard manufacturers. Both companies deny and claim that there is no such plans of a merger or buy into as rumoured. The news was also reported on Bloomberg on Saturday.

Foxconn has a sales volume of 40 million boards, with 32 million coming from OEM orders. This is close to ASUS total volume of 52 million.In 2006, ASUS has a target of 60 million boards, in the first half of the year, total volume was 26million. As for Gigabyte 1H 2006 output volume was 8.03 million, which falls short of the target of 18 million. If both ASUS and Gigabyte combines it volume, it will reach a total targetted volume of 78 million.

If that merger materialise, we would see that both will eat up a combined total of 45% of total marketshare.This will definitely increase its sales volume against major competitor Foxcon, ECS and MSI.

As Gigabyte has reorg lately and 1/3 of the directorship is investors driven, it is possible for big companies to buy into it.