RESEARCH TRIANGLE PARK – IBM’s new chief executive officer says he has no plans to split the tech giant or make more divestitures but instead is open to the idea of making acquisitions.
In an interview on Fox Business News, Arvind Krishna also said he doesn’t intend to reduce Big Blue’s 5% dividend.
“I believe that we actually have enough financial stability, including a secure dividend,” Krishna said on “Mornings with Maria.” “The dividend is occupying a little bit more than half our free cash flow. It’s not like it’s occupying all of it, and that leaves enough flexibility for us to do it.”
Krishna’s appearance came as IBM opened a major tech conference that it is presenting virtually.
He took over as CEO in early April.
Last year, IBM closed on the biggest tech deal ever – the $34 billion buy of Raleigh-based Red Hat. Looking ahead, Krishna said the tech giant is “always open for acquisitions when they make strategic sense and when the price is right.”
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Krishna added that IBM isn’t planning future divestitures or considering a breakup.
“In terms of divestitures, we’ve always pruned our portfolio appropriately. When there are pieces that don’t align with a strategy or they become too commoditized for us to deal with them, we have done divestitures. And you’ve seen us doing that over the past two years,” Krishna said.
“Our model is so integrated, it really makes sense for our clients,” he added. “And I think that need is going to accelerate in this crisis. Our clients are looking for us to bring solutions to them —to really solve the puzzle for them, and if you look at our services, they’re really often linked to our products.”
In an interview with The Wall Street Journal, Krishan said that the COVID-19 pandemic will accelerate adoption of hybrid cloud and artificial intelligence.
IBM operates one of its largest global campuses in RTP and employes thousands of people across the state, including Red Hat which maintains its headquarters in Raleigh.
