When Lenovo, the PC maker, sold its mobile unit to get rid of the loss-making business in 2008 for $100 million, the company may not have realized the opportunities it let go with that deal. Quite a late move, yet, 18 months later, the company has realized the mistake and is set to reverse that move. The sudden realization of losing on the competitive track dawned on them as the rivals like HP, Acer, and Dell are gung-ho over the new innovation in the mobile line. So, it plans for a buy-back of the mobile unit at double the cost for $200 million to be a befitting competitor in the era of Mobile Internet Device (MID), a gadget positioned between a netbook and a smartphone.

Its first net profit in a year during its most recent fiscal quarter shows the company’s recent focus back to China has turned fruitful and the buy-back is expected to boost it. The PC maker says that the handset unit had undergone a turnaround from reporting a 235 million yuan ($34.4 million) loss before tax in 2007, to a 40 million yuan profit before tax in the first half of 2009. The company has already developed an MID and the mobile unit buyout will help Lenovo to push it to the market. It would pay $154 million in cash and $46 million in its shares to Hony Capital, the private equity arm of Legend Holdings, which is also Lenovo's parent company, to buy Lenovo Mobile Communication Technology from them.

The decision comes as Lenovo Mobile continues to remain the third largest domestic mobile brand of China, behind Nokia and Motorola, with around six percent market share. Analysts are quite dejected by Lenovo’s late decision. “It makes you feel that they are always a bit late. Also, the price tag for the deal is a bit high,” says Charles Guo at J.P. Morgan. However, the repurchase has not perturbed Lenovo’s rivals, which implies its perceived lack of ability to compete amidst their already publicized mobile ventures.