Coming on the heels of IBM's recent sale of its personal computing unit to Lenovo, IBM and China Great Wall Computer Company (Shenzhen) announced this week the signing of an agreement that will set up a joint manufacturing venture with an initial investment of US$7 million.

 

The new venture, International Systems Technology Company, will replace a 10-year-old alliance between the two companiesalled International Information Products (Shenzhen) Co Ltd. Production will remain based at the present location in a four-building facility in the Futian district of Shenzhen.

 

The companies indicated that the joint venture would focus on design and production of high-end offerings, mainly servers. The venture is intended to serve as the Asia-Pacific production base for IBM's eServer xSeries. An IBM spokesperson noted that the new venture would temporarily have to share its production facility with Lenovo's PC manufacturing lines until the two can be separated. IBM will hold 80% stake in the joint venture, with the Great Wall holding the remaining 20%. Currently, the joint venture has posted registered capital of US$3.5 million.