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Lenovo’s expansion ambitions are being put on hold as the personal computer and notebook manufacturer says it will not pursue an acquisition of Positivo Informatica, a Brazilian computer and software maker.

For more than two weeks, Lenovo has been rumored to be pursuing an acquisition with another small PC manufacturer to bolster its competitive positioning against larger rivals. Lenovo, a Chinese owned company with its global headquarters in North Carolina, is the world’s fourth largest computer company behind Hewlett-Packard, Dell and Acer.

According to the Wall Street Journal, sources within Lenovo say serious consideration was giving to buying Positivo but Lenovo decided against the deal. The source said, “The opportunity had been there, but Lenovo has decided not to go ahead with it for now.” No other reason was giving for the deal’s collapse.

While Lenovo’s liquidity remains strong, some analysts questioned the wisdom of a large acquisition in light of the global recession and slowing demand for personal computers. No value was placed on the possible Lenovo-Positivo deal.

Reports of the deal surfaced at the beginning of the month when sources leaked said Lenovo was looking to acquire an undisclosed Brazilian company or another computer manufacturer. Positivo made the candidate’s list, but so did Fujitsu-Siemens PC business.

Dell, the world’s second largest computer company, was also rumored to be in the mix to acquire Positivo.

Lenovo was founded in China and remained largely confined to its home market until 2005, when it purchased IBM’s ThinkPad notebook division. Follwing the deal, Lenovo said it wanted to capture more U.S. marketshare, but was more focused on expanding its emerging market, particularly in Brazil, Russia, India and China–the so-called BRIC countries.