IBM to acquire cloud computing firm for nearly $2B

IBM, the world’s largest seller of computer services, agreed to buy SoftLayer Technologies, a provider of infrastructure for cloud computing.

Big Blue (NYSE: IBM) is paying almost $2 billion for SoftLayer, according to a person familiar with the deal, who declined to be named because the financial terms aren’t being released.

SoftLayer serves about 21,000 customers using a network of 13 data centers in the U.S., Asia and Europe, IBM said in a statement.

IBM plans to combine Dallas-based SoftLayer with its SmartCloud unit to create a new Cloud Services division, helping capitalize on the market’s growth. SoftLayer specializes in public clouds — data-center networks that manage computing and software for businesses remotely. IBM is pairing those capabilities with its private-cloud operations, which build dedicated systems for individual customers.

“As businesses add public cloud capabilities to their on-premise IT systems, they need enterprise-grade reliability, security and management. To address this opportunity, IBM has built a portfolio of high-value private, public and hybrid cloud offerings, as well as software-as-a-service business solutions,” said Erich Clementi, senior vice president, IBM Global Technology Services. “With SoftLayer, IBM will accelerate the build-out of our public cloud infrastructure to give clients the broadest choice of cloud offerings to drive business innovation.”

IBM, based in Armonk, New York, expects to complete the SoftLayer deal in the third quarter, setting the stage for the new division to be formed. SoftLayer is majority owned by private-equity firm GI Partners of Menlo Park, California.

James Sciales, an IBM spokesman, declined to comment on a deal price.

IBM Corp. started its cloud business in 2007 and has spent $4.5 billion on cloud-related acquisitions in the past five years, according to spokeswoman Colleen Haikes. Big Blue anticipates hitting $7 billion annually in cloud revenue by the end of 2015.

The acquisition is expected to close in the third quarter. Once the transaction is completed, SoftLayer and IBM’s existing SmartCloud unit will be combined in a Cloud Services division under the charge of Erich Clementi, a senior vice president at IBM.

IBM employs some 10,000 people across North Carolina.

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