RESEARCH TRIANGLE PARK – IBM is investing more than $2 billion in cash to bolster its artificial intelligence and cloud computing lineup by acquiring an integration platform as a service suite from Software AG.
The deal worth some $2.3 billion was announced early Monday.
The deal is for Software AG’s StreamSets and webMethods offerings.
It’s the latest acquisition for Big Blue under Chair and CEO Arvind Krishna. In June it announced a $4.6 billion deal to acquire Apptio, a provider of financial and operational IT management and optimization (FinOps) software. Since Krishna became the top exec in 2020 IBM has acquired more than 30 companies, many in the AI-related space.
Software AG, which is based in Germany, is majority owned by private equity firm Silver Lake.
According to IBM, the deal will boost “data ingestion capabilities” by its watsonX AI-focused business unit and will also bolster its hybrid cloud (a mixture of enterprise and public servers) offerings. Raleigh-based Red Hat is an essential part of IBM’s cloud efforts.
“[B]oth StreamSets and webMethods expected to drive synergy with IBM’s current portfolio, including watsonx, Red Hat, the company’s IT automation products, as well as IBM Consulting. Additionally, StreamSets and webMethods are expected to benefit from IBM’s global scale, operating in more than 175 countries. essential part of IBM’s cloud efforts,” IBM added.
Application modernization & AI
“Together with IBM’s watsonx AI and data platform, as well as its application modernization, data fabric and IT automation products, StreamSets and webMethods will help clients unlock the full potential of their applications and data,” said Rob Thomas, Senior Vice President, Software and Chief Commercial Officer at IBM, in the deal announcement. “This powerful combination helps drive innovation while preparing businesses for AI, no matter where applications or data reside.
“Today’s news will give IBM clients and partners one of the most modern and comprehensive application and data integration platforms in the industry,” Thomas added.
IBM said the products will help enhance application and data integrations for clients’ modernization efforts including AI.
Citing industry statistics from research firm IDC, IBM says the worldwide integration software market “will exceed $18.0 billion in 2027 at a compound annual growth rate (CAGR) of 16.1%.”
Here’s how IBM describes the two applications:
- StreamSets – a cloud-native DataOps and data ingestion platform which allows enterprises to achieve consistent access and delivery of data across a wide spectrum of data sources and types. StreamSets also facilitates the design of smart data pipelines and the ingestion of real-time and batch data.
- webMethods – an integration and API management platform. The integration platform, deployed both on-prem and in the cloud, offers B2B integration, managed file transfer, and provides a modern API gateway to manage, monitor, and monetize APIs.
The deal is expected to close in the second quarter of 2024.
IBM owns Red Hat, operates one of its largest corporate campuses in RTP, and employs thousands of people across North Carolina.