Gateway Inc. (GTW), the personal computer maker, Friday rejected a bid to take over its retail operations by Lap Shun Hui, a former executive at eMachines.

In a statement, Gateway said its board "has determined that the unsolicited expression of interest from Lap Shun (John) Hui to acquire Gateway's retail operations is not in the best interest of shareholders."

Hui, owner of Joui International and the former owner of eMachines, made an unsolicited $450 million bid for the retail operations last month.

Shares of Gateway, a former high-flyer, famous for shipping computers in cow-spotted boxes that recalled its origins in an Iowa farmhouse, fell 2.5 percent, or 5 cents, to $1.95 on the New York Stock Exchange.

Gateway, which has retained Goldman, Sachs & Co. (GS) as its financial advisor, said it remained committed to "taking the appropriate steps to enhance shareholder value."

The company, in a statement, did not address Hui's separate offer to explore buying all outstanding shares in the whole company.

Hui has said Gateway must separate its retail operation from its other businesses and improve its margins if it is to compete effectively with PC leaders Dell Inc. (DELL) and Hewlett-Packard Co. (HPQ).

Another group of investors, including Harbert Management Corp., said in a regulatory filing on Aug. 21 it had acquired 10.2 percent of Gateway. That group wants to help Gateway reinvigorate its business and its brand.