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Abu Dhabi, UAESunday 16 December 2018

India's HCL to acquire select IBM software products for $1.8bn

The software products in scope of the agreement represent a total addressable market of more than $50bn

IBM has prioritised its investments to develop integrated capabilities. AP
IBM has prioritised its investments to develop integrated capabilities. AP

Indian tech giant HCL Technologies will be acquiring select software products from IBM for $1.8 billion.

This transaction is expected to close by mid-2019, subject to completion of applicable regulatory reviews.

“We continue to see great opportunities in the market to enhance our Mode-3 (products and platforms) offerings. The products that we are acquiring are in large growing market areas like security, marketing and commerce which are strategic segments for HCL,” said C Vijayakumar, president chief executive of HCL Technologies.

“Many of these products are well regarded by clients and positioned in the top quadrant by industry analysts."

HCL Technologies, which operates out of 43 countries, has consolidated revenues worth $8.2bn, for 12 months - ended 30 September, 2018.

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“We have been prioritising our investments to develop integrated capabilities in areas such as hybrid cloud, cybersecurity, analytics, supply chain and blockchain as well as industry-specific platforms. These are among the emerging, high-value segments of the IT industry,” said John Kelly, IBM’s senior vice president - cognitive solutions and research.

“We believe the time is right to divest these select collaboration, marketing and commerce software assets, which are increasingly delivered as stand-alone products. At the same time, we believe these products are a strong strategic fit for HCL,” stated Mr Kelly.

The software products in scope of the agreement represent a total addressable market of more than $50bn.