Gateway Spurns Retail Buyout Offer

Gateway is turning down a $450 million offer from eMachines's founder for the company's retail business.

Computer maker Gateway announced today that its board of directors is turning down a $450 million offer from Lap Shun Hui, found of eMachines, to acquire Gateway’s retail business. Gateway says the board and the company’s management team felt that the unsolicited offer was not in the best interest of the company’s shareholders.

Lap Shun (John ) Hui is founder of eMachines, and the second largest shareholder in Gateway since the company purchased eMachines back in 2004. Hui has said he felt Gateway should be taken private, and that the company’s current management is not moving the company forward or determine a strategic direction. (For instance, Gateway’s CEO position has been vacant for six months.) Last week, Gateway disclosed Hui had made an unsolicited $450 million offer for Gateway’s retail business; Hui also indicated he’s consider purchasing all Gateway’s outstanding shared and separating out the retail business if that would be easier for Gateway’s board to support.