IBM to buy Cognos for £2.5bn

IBM has agreed to buy business intelligence software vendor Cognos for around US$5bn (£2.5bn) in cash.

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IBM has agreed to buy business intelligence software vendor Cognos for around US$5bn (£2.5bn) in cash.

The acquisition has yet top be approved by Cognos shareholders and regulators, but is expected to complete in the first quarter of 2008.

IBM said the acquisition would supports its Information on Demand strategy, a cross-company initiative that combines hte company's expertise in information integration, content and data management and business consulting services.

Cognos will be the 23rd IBM acquisition in support of its Information on Demand strategy.

"Customers are demanding complete solutions, not piece parts, to enable real-time decision making," said Steve Mills, senior vice president and group executive, IBM Software Group.

"IBM has been providing Business Intelligence solutions for decades. Our broad set of capabilities — from data warehousing to information integration and analytics — together with Cognos, position us well for the changing Business Intelligence and Performance Management industry. We chose Cognos because of its industry-leading technology that is based on open standards, which complements IBM's Service Oriented Architecture strategy."

The move follows a period of consolidation in the BI and performance management software market, where Oracle bought Hyperion, while Cartesis and ALG Software were snapped up by Business Objects, which is itself being swallowed by SAP. Cognos also bought the much smaller performance management software vendor Applix earlier this year.

The move will be a blow to IBM rival Hewlett-Packard, which offers a business intelligence and data warehousing platform built using products from Cognos.

IBM intends to integrate Cognos into its Information Management Software division when the deal closes. That should happen in the first quarter of 2008, subject to regulatory approvals and other closing conditions, the companies said Monday.

Cognos CEO Rob Ashe will join IBM to lead the Cognos team there, reporting to the general manager of the IMS division, Ambuj Goyal.

IBM did not say how many of Cognos's other 4,000 employees it planned to retain.

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