Beleaguered US computer products retailer Micro Warehouse is being bought for $725 million by a an investment group led by former IBM executive and Apple board member Jerome York.

The deal - expected to be sealed by the end of January - will see Micro Warehouse co-founder Peter Godfrey replaced by York as chairman and chief executive. York was chief financial officer of IBM in the mid-1990s.

The buyout continues the recent trend of private investment groups scooping low-priced stocks that are cheap relative to earnings.

Such stocks have treaded water while high-flying Internet issues have hogged the headlines.

Micro Warehouse has suffered in recent years at the hands of competition from online electronics retailers, falling sales for its core Apple product lines, management turmoil and shareholder lawsuits.