IBM to acquire cloud, hosting services provider SoftLayer

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ibm, cloud computing, hosting, softlayer

IBM has agreed to purchase cloud services provider SoftLayer Technologies Inc. following months of speculation that such a deal was in the works. Financial terms of the deal were not disclosed although rumors from just a few months ago pegged the value of the acquisition at more than $2 billion.

The plan for IBM is to combine SoftLayer with their existing SmartCloud division to create an entirely new division designed to capitalize on market growth. It’s a move that IBM says will accelerate the build-out of their public cloud infrastructure to give clients the broadest choice of cloud offerings to drive business innovation.

At present, Dallas-based SoftLayer provides service to some 21,000 customers (mostly small and medium-sizes businesses -- including TechSpot) through the use of 13 data centers in the US, Asia and Europe. The company was founded in 2005 and has since grown into the world’s largest privately held cloud computing provider with more than 100,000 devices under management. GI Partners of Menlo Park, California, is the majority shareholder for SoftLayer.

The move looks to be a good one for IBM as they forecast revenue of $7 billion annually from cloud services by the end of 2015. The deal is expected to be finalized by the third quarter at which time the aforementioned Cloud Services division will be formed. The new division will report to Erich Clementi, senior vice president of IBM global technology services, we’re told.

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