Major motherboard maker Elitegroup has bought the computer division of Tatung for 6.7 billion Taiwanese dollars - £117 million.

Elitegroup is one of the world's largest makers of computer motherboards, but it also produces notebook and desktop PCs on behalf of major companies, such as HP. The addition of Tatung's PC division into its fold increases the size of Elitegroup's contract PC manufacturing business, which will help the company reduce costs, it said.

"We issued new shares to pay for the division," said a spokesperson for Elitegroup. The company offered Tatung 314 million of its shares.