Lenovo's efforts to enter the smartphone industry seem to have taken another twist, with the company reportedly interested in acquiring floundering NEC's mobile division.
Reuters reported on Friday that the two companies are in talks over a potential takeover, following two straight years of losses for the Japanese company's mobile offerings.
Lenovo has been vocal about its desires to pick up a smartphone property to complement its booming PC and tablet business.
High ranking officials at the company have recently been talking up potential interest in buying up BlackBerry, but any purchase of NEC would surely kill such talk.
Deal or no deal?
In response to media reports on Friday, NEC issued a statement claiming nothing had been decided, but did not deny talks were ongoing.
"Amid the rapidly changing market we are considering a number of ways to bolster the competitiveness of our mobile phone business, but nothing has been decided," the company said.
Former Everton FC kit sponsor NEC has struggled to gain traction internationally with its range of handsets, while competition from Samsung and Apple has hindered its efforts domestically.
Lenovo hasn't yet commented on the reports.