Pot, kettle, blue

20 September 2010 By Robert Cyran Follow @rob_cyran

Big Blue boss Sam Palmisano rubbished rival HP for overpriced acquisitions. Now his firm is paying $1.7 bln, a lofty 65 times expected 2010 operating profit, for data and analytics outfit Netezza. At this buzzinflated price, it will take fancy footwork to make the deal pay off.

This content is for Subscribers only

Context News

IBM on Sept. 20 said it had agreed to buy Netezza for about $1.7 billion after adjusting for cash, or $27 per share. The price is a 10 percent premium to where the company's shares closed on Sept. 17, but a 94 percent premium to their price on Aug. 13, the last trading day before Dell made a bid for 3PAR, a data storage rival of Netezza.

In early trading on Sept. 20, Netezza shares stood 3 percent above IBM's offer.

Netezza is a data warehousing and analytics firm. In the last four years, IBM has invested more than $12 billion in 23 analyticsrelated acquisitions. The company said earlier this year that it plans to spend $20 billion on M&A over the next five years.

Context News

In early trading on Sept. 20, Netezza shares stood 3 percent above IBM's offer.

Email a friend

Please complete the form below.

Required fields *