Posted Jun. 26, 2014 at 6:50 a.m.

Lenovo-IBM server deal 'in limbo' over security concerns

Published: 2014-06-26 06:50:27
Updated: 2014-06-26 06:50:27

Here it is the end of June and no approval yet for a deal that would transfer more than 2,000 IBM workers in the Triangle to nearby Lenovo.

After months of talking, Lenovo and IBM (NYSE: IBM) remain involved in discussions with the U.S. government as they try to win approval for their $2.3 billion x86 server deal.

The deal "remains in limbo," says The Wall Street Journal.

The hangup remains concerns about security, the newspaper says. 

Recent WRAL TechWire Coverage of IBM-Lenovo Deal:

"The deal, struck in January, remains in limbo as the U.S. government investigates security issues around IBM's x86 servers, which are used in the nation's communications networks and in data centers that support the Pentagon's computer networks, say people familiar with the matter," according to The Journal.

The Committee on Foreign Investment in the U.S. is "worried" that servers "could be accessed remotely by Chinese spies or hackers" or even "compromised through maintenance," the paper says. 

The Journal cited unnamed sources. 

Lenovo was able to overcome similar concerns in 2005 when it bought IBM's personal computing business, which was largely based in Raleigh.

Much of the x86 business also is based in the Triangle, including its top management.

Earlier this month, Bloomberg reported that IBM and Lenovo had sought an extension of the government review.

In April, Bloomberg reported that the two companies were running into na "perfect storm" as they review process unfolded.

The full story is available online.

  • IBM Insider Case Widens

In other IBM news, an insider case dating back to 2009 when Big Blue acquired SPSS for $1.2 billion has widened.

Various news agencies, including Bloomberg, reported Wednesday that two more people have been charged in the case.

The investigation already has resulted in three convictions.

The Bloomberg account is available online.



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