IBM Strikes Billion-Dollar Deal with Netezza

By Cindy Waxer September 20, 2010

IBM’s shopping spree continues with today’s acquisition of analytics firm Netezza for $1.7 billion, or $27 a share. Big Blue has spent $12 billion over the past four years purchasing 23 analytics companies.

In fact, IBM says it plans to spend $20 billion on acquisitions through 2015. Shares of Netezza jumped $3.13, or 13 percent to $27.73. The company’s products fuse data warehousing and analytics to help clients such as Neiman Marcus, Time Warner and Virgin Media deploy analytic applications that scale to remarkable sizes. 
While IBM’s analytics arm grew 14 percent last quarter, competitors such as Hewlett-Packard and Oracle are also attempting to capitalize on the anticipated growth of the data analytics industry with innovative solutions.

Netezza isn’t new to IBM. The company has long been designing and developing its appliances on IBM systems technology. In fact, the two companies have been working together for many years to create workload optimized systems that deliver integrated systems and storage for analyzing vast amounts of complex data.

“IBM is bringing analytics to the masses. We continue to evolve our capabilities for systems integration, bringing together optimized hardware and software, in response to increasing demand for technology that delivers true business value. Netezza is a perfect example of this approach,” said IBM’s Steve Mills, senior vice president and group executive, in a statement. “Netezza strongly complements our business analytics capabilities and client base. Together, we have the opportunity to quickly leverage the technology and accelerate the offering.”

As news broke of the acquisition, Kendall Law Group, a national securities firm led by a former federal judge, announced that it is investigating Netezza for shareholders in connection with the acquisition. The firm is investigating whether Netezza properly shopped the company prior to entering into the agreement. According to the group, a possible breach of fiduciary duty may have kept the company from reaching a deal that would provide better value for shareholders. 

Edited by Erin Harrison

TechZone360 Contributing Editor

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