Toshiba Subsidiary Acquires IBM's Point-of-Sale Business Unit for $850 Million

By

Toshiba Tec, a business unit of Japanese electronics giant Toshiba, has agreed to purchase IBM’s Retail Store Solutions business to complement its own point-of-sale (POS) product portfolio.

Under the terms of the transaction, Toshiba Tec will acquire IBM’s POS terminal operations and assets for an all-cash sum of around $850 million using its own surplus and a series of banks loans, according to the Wall Street Journal.

Toshiba Tec maintains a strong presence in the Asian Pacific markets – selling scanners, barcode readers and other hardware for transactions processing and inventory management – but has yet to make a big splash in Western markets. IBM’s business unit commands as much as 25 percent of the global POS terminal market, says the Journal.

On the surface, the deal seems to make sense for both parties. Toshiba Tec can expand its operations westward by gaining access to IBM’s global client base, headlined by retail behemoths like Wal-Mart and Toys R Us. IBM’s Retail Store Solutions business generated revenues of more than $1.1 billion last year. The Toshiba subsidiary will also sign a multi-year agreement with IBM to become one of the company’s premier business partners.

“It will have a major impact for Toshiba Tec,” Hideki Yasuda, an analyst at Ace Securities Co. in Tokyo, told Bloomberg. “Toshiba Tec will be able to expand its POS business with the acquisition, as IBM already has customers and can lure new ones with its brand.”

In return, IBM will receive a lump cash sum that will enable the company to dedicate more resources to its software and cloud computing push. 

The transaction is expected to close at the end of the second quarter. In an effort to promote a smooth transfer, IBM and Toshiba Tec will create a holding company that will manage the new business for a short period. Toshiba Tec will maintain and 80.1 percent stake in the holding company for three years, at which time it will purchase IBM’s remaining 19.9 percent equity interest.






Edited by Jennifer Russell

TechZone360 Contributor

SHARE THIS ARTICLE
Related Articles

Coding and Invention Made Fun

By: Special Guest    10/12/2018

SAM is a series of kits that integrates hardware and software with the Internet. Combining wireless building blocks composed of sensors and actors con…

Read More

Facebook Marketplace Now Leverages AI

By: Paula Bernier    10/3/2018

Artificial intelligence is changing the way businesses interact with customers. Facebook's announcement this week is just another example of how this …

Read More

Oct. 17 Webinar to Address Apache Spark Benefits, Tools

By: Paula Bernier    10/2/2018

In the upcoming webinar "Apache Spark: The New Enterprise Backbone for ETL, Batch and Real-time Streaming," industry experts will offer details on clo…

Read More

It's Black and White: Cybercriminals Are Spending 10x More Than Enterprises to Control, Disrupt and Steal

By: Cynthia S. Artin    9/26/2018

In a stunning new report by Carbon Black, "Hacking, Escalating Attacks and The Role of Threat Hunting" the company revealed that 92% of UK companies s…

Read More

6 Challenges of 5G, and the 9 Pillars of Assurance Strategy

By: Special Guest    9/17/2018

To make 5G possible, everything will change. The 5G network will involve new antennas and chipsets, new architectures, new KPIs, new vendors, cloud di…

Read More