IBM Offers Security Plan for Lenovo Deal

IBM Corp. offered U.S. national-security regulators concessions aimed at overcoming objections to the sale of its personal-computer unit to China’s Lenovo Group Ltd., people familiar with the matter said.

IBM made the proposal Wednesday to the Committee on Foreign Investment in the United States, the government body that must approve the $1.25-billion sale. After a three-hour meeting in Washington, the committee failed to reach a decision on whether IBM’s offer went far enough, the sources said.

The concessions include preventing Lenovo from knowing the names of IBM’s U.S. government customers, physically sealing off buildings in a shared office park and moving thousands of employees to other locations.

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*IBM Corp. reduced its 2004 revenue by $260 million after discovering that some employees in Japan had booked sales improperly. The Armonk, N.Y.-based company may also repatriate as much as $8 billion in foreign earnings to take advantage of a lower tax rate, IBM said in a filing with the Securities and Exchange Commission.