IBM is reportedly in advanced discussions to acquire Confluent, a data-infrastructure company, for approximately $11 billion, according to the Wall Street Journal. This strategic move aims to significantly enhance IBM's capabilities in the growing market for cloud services and real-time data processing.
Confluent is an open-source platform specializing in processing massive streams of real-time data, covering applications from bank transactions to website clicks. The reported acquisition price is around $11 billion. Confluent's current market capitalization is approximately $8.09 billion.
The deal could potentially be announced as early as Monday, according to the report citing unnamed sources. In October, Confluent was reported to be weighing a potential sale after receiving interest from prospective buyers.
The acquisition is driven by IBM's need to boost its core cloud software business and maintain overall growth momentum, especially after reporting slower growth in that sector in October.
Under CEO Arvind Krishna, IBM has focused on software and cloud services to capitalize on rising demand, which is currently fueled by the development of generative artificial intelligence (AI). This follows IBM's previous major acquisition of HashiCorp for $6.4 billion last year. The interest in Confluent highlights a broader surge in demand for data infrastructure companies necessary to support the corporate race for AI development.
Another recent notable deal includes Salesforce's agreement to acquire software maker Informatica for about $8 billion to bolster its own AI capabilities. Confluent shares closed at $23.14 on Friday. IBM's market value is roughly $287.84 billion.
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