Chinese computer maker Lenovo said it would buy IBM’s industry-standard x86 server business, in an agreement valued at $2.3bn in cash and stock.

The likely deal offered IBM a long-sought after exit from the low-end server business – it had originally approached Lenovo about selling the business last year. IBM’s top executives on Tuesday volunteered to give up their bonuses for 2013 after announcing a 5 per cent fall in revenues for the fourth quarter, though net income rose by 6 per cent.

For Lenovo, which became a globally-recognised consumer PC brand after it bought IBM’s PC business in 2005, the deal is a way to expand its market share in servers, especially in its home market. Lenovo has 10 per cent of the Chinese servers market, and only a 2 per cent market share globally.