IBM Nears Deal To Buy Software Company Apptio For $5 Billion
International Business Machines Co. (NYSE: IBM) is nearing a deal for the acquisition of Apptio Inc., a cloud-based business software company, for about $5 billion, the Wall Street Journal reported.
https://www.msn.com/en-us/money/other/ibm-nears-deal-to-buy-software-company-apptio-for-5-billion/ar-AA1cZ2eL
As many as needed. They are still paying off other companies they brought ie Red Hat
Good point about the 401K.
Apptio folks: prepare to lose yours.
I think IBM bought them not just for the software revenue, but also because IBM Consulting Services wants to build up the FinOps practice and Apptio would be a key part of that. Obviously they paid a huge huge premium for this acquisition just as they did for Red Hat years ago. No doubt that IBM downsizes other areas unfortunately to pay for this as well as removing the 401K plan in the US for a shady and suspect RBA plan. Corporations are just ruthless these days.
And so IBM's net debt will go up by yet another 5 billion.
IBM overpaid for this company. Their annual sales were in the hundreds of millions, not even close to 1 billion.
I got to experience IBM destruction of acquired companies firsthand, via Rational Software, Telelogic Software, and UrbanCode.
Apptio employees - you will be assimilated, your product will be 'blue washed', and you will not be happy.
Don't walk ... RUN.
The Apptio product set is, by many accounts, really good at what it does (IT cost management and reporting). This is an interesting purchase by IBM because the acquisition target doesn't make "technology" in the classic sense. It just automates what accountants and financial analysts do every day and every month with Excel spreadsheets...provide analytics on IT spending.
I imagine that may be an uncharitable way of describing their business, but it does give some insight on what IBM executives may be thinking. Apptio is not an AI company, a cloud computing company, or a quantum computing startup. It doesn't make "IT plumbing" products like a Cisco or Microsoft or Red Hat. IBM paid $5B for a developer of accounting software. That's $5B that could have been used to develop better products and services. It doesn't seem like a great tradeoff.
The better question is how much value to the economy has IBM destroy through acquisitions. I'll bet more than the net GDP for many developed nations. It's so wrong. This company should be legally prevented from any future acquisitions.