IBM to sell low-end server unit to Lenovo for $2.3B


As flagged, IBM (IBM) has agreed to sell its low-end x86 server business to Lenovo (LNVGY) for $2.3B, of which $2B will be in cash and the rest in stock.

IBM and Lenovo will also form a partnership that will include a global OEM and reseller agreement for various IBM products, including its entry and mid-range Storwize disk storage systems.

Around 7,500 IBM employees will be offered jobs at Lenovo.

"This divestiture allows IBM to focus on system and software innovations...such as cognitive computing, Big Data and cloud," says IBM's Steve Mills.

The deal comes after IBM's hardware division suffered another wretched quarter in Q4, with x86 sales dropping 16%.

The question is whether U.S. security concerns will cause a delay to the transaction or cause it to be blocked. (PR)

From other sites
Comments (7)
  • mitrado
    , contributor
    Comments (2033) | Send Message
     
    More 3 years of this and Lenovo will be IBM.
    23 Jan 2014, 05:16 AM Reply Like
  • samuel_liu
    , contributor
    Comments (2753) | Send Message
     
    Lenovo kicked out the IBM senior executives: 1st Stephen Ward, then William Amelio next Rory Reed ...
    23 Jan 2014, 06:41 AM Reply Like
  • habear
    , contributor
    Comments (88) | Send Message
     
    wish it could've been done before reporting Q4 earnings
    23 Jan 2014, 05:19 AM Reply Like
  • Momintn
    , contributor
    Comments (6072) | Send Message
     
    Lenovo gets more stock this way.
    23 Jan 2014, 08:37 AM Reply Like
  • bd4uandu
    , contributor
    Comments (2074) | Send Message
     
    Now IBM doesn't have to be distracted with making things. The can sit around and be cognitive.
    23 Jan 2014, 01:25 PM Reply Like
  • TREBOR J
    , contributor
    Comments (13) | Send Message
     
    Beautiful scenery, the CIA, Vassar and now Chinese food.
    Another reason to visit Poughkeepsie.
    bob j
    23 Jan 2014, 02:42 PM Reply Like
  • Henry Shine
    , contributor
    Comments (51) | Send Message
     
    Selling the farm does not make you rich, it just means you starve in the long run.

     

    IBM's decline is accelerating.
    23 Jan 2014, 03:18 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs