Workers at an IBM factory in Shenzhen in southern China have been on strike for the fifth straight day, forcing the company to shut down its entire production.

The workers, numbering more than 1,000, were protesting the terms of their transfer to Chinese PC maker Lenovo, which bought IBM's x-86 server business for US$2.3 billion in January.

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Under the deal, IBM said its approximately 7,500 employees around the world, including those based in Shanghai, Shenzhen and Taipei, would be offered employment by Lenovo. 

The demonstrators claim that those who opted to leave the company were not offered a fair separation package. The workers had asked for higher pay if they chose to continue working for Lenovo, or higher separation pay if they chose to leave.

"The terms offered to IBM workers in Shenzhen are comparable in aggregate to what they currently are receiving.  If they choose to leave, they will receive an equitable severance package," IBM spokeswoman Florence Ma told Reuters news.

Lenovo, on the other hand, has yet to issue a statement on the strike, which the workers said they will continue until management hears their demands.

Lenovo's acquisition of IBM's server business was not the first time the two hardware giants had done business together. 

In 2005, Lenovo acquired IBM's ThinkPad personal computers for US$ 1.75 billion, then considered the largest international acquisition by a Chinese technology company, catapulting Lenovo into its position as the world's largest PC manufacturer.

Similarly, Lenovo's acquisition of IBM's x86 server business is expected to turn it into a leading player in the server market, fortifying itself against industry leaders Hewlett-Packard and Dell.