[via BetaNews]

Rumors are confirmed…

IBM has officially confirmed it will sell its PC business to Chinese computer maker Lenovo for a total of $1.75 billion. […]

Lenovo will pay IBM $650 million in cash, another $600 million in common stock, and assume $500 million in debt from Big Blue. IBM will become Lenovo’s second largest shareholder with a stake of 18.9 percent in the company, and over 10,000 IBM employees will migrate to Lenovo.

The deal creates the third-largest PC company in the world behind Dell and Hewlett-Packard. Lenovo will receive a 5-year license to use the internationally recognized IBM brand name and “Think” trademarks on its desktop and notebook PCs.

Lenovo’s new PC business will be located in the United States, with headquarters in New York and principal operations in Raleigh, North Carolina, where IBM currently handles PC development. Stephen Ward, current IBM senior vice president and general manager of IBM’s Personal Systems Group, will become CEO of Lenovo. Current Lenovo CEO Yuanqing Yang will become Chairman of the company.