IBM to Offload x86 Server Business to Lenovo for US$2.3 Billion
IBM has agreed to sell its x86 server business to Lenovo for US$2.3 billion. IBM isn’t exiting the server business just yet as it will retain its high-end servers like the Power Systems, Power-based Flex machines and System z mainframes, together with its storage and cloud solutions.
According to Lenovo, they would be acquiring the following IBM products and services; System x, BladeCenter and Flex System blade servers and switches, x86-based Flex integrated systems, NeXtScale and iDataPlex servers and associated software, blade networking and maintenance operations. This definitive agreement between the two companies happens almost a decade after Lenovo acquired IBM’s personal computing division in 2004. This eventually propelled Lenovo to be the top global PC vendor.
As observed by the Wall Street Journal, this deal will be under the scrutiny of security agencies of the United States. This is due to the pervasive usage of the affected servers by the United States government, and in the country’s critical infrastructure operations. For the deal to be successful, both companies need to seek clearance from the Committee on Foreign Investment in the U.S. (CFIUS). Once finalized, about 7,500 IBM staff members will be offered jobs at Lenovo. Please click here for the joint press release from IBM and Lenovo.