ASUS withdrawing from mobo manufacturing

No before you start to stress -- it simply means that motherboard manufacturing would become outsourced rather then self (in-house) made. Anyway, xbitlabs is reporting that Asustek decided to completely spin off its mainboards and graphics cards manufacturing arm Pegatron Technologies, the company said this week.

The move will allow Asus to become more competitive in terms of branding, but will further withdraw the firm from the actual manufacturing. According to a statement posted with Taiwan Stock Exchange, Asustek company had convened a board meeting to resolve the spin-off of its ODM business. As a result of the meeting, Pegatron Holding, the company that made virtually all Asus-branded motherboards, will issue two billion new shares to a number of shareholders.

Asustek Computer and all shareholders of the company as consideration, among which it is expected that the company will receive 25% of the equity and all shareholders of the company will in total receive 75% of the equity in Pegatron Holding in proportion to their shareholdings in the company.

As a result of the move, Asus-branded mainboard are likely to be targeted not only on the highest possible quality market, but also onto performance mainstream segment. The question is what can a premium brand offer in the value segment?