Lenovo Buys IBM’s x86 Server Business


Lenovo plans to acquire IBM’s x86 server business for approximately $2.3 billion. Approximately 7,500 IBM employees around the world, including those based at major locations such as Raleigh, Shanghai, Shenzhen and Taipei, are expected to join Lenovo as part of the acquisition.

The acquisition includes System x, BladeCenter and Flex System blade servers and switches, x86-based Flex integrated systems, NeXtScale and iDataPlex servers and associated software, as well as blade networking and maintenance operations. IBM will retain its System z mainframes, power systems, storage systems, power-based Flex servers, and PureApplication and PureData appliances. IBM will also continue to develop and evolve its Windows and Linux software portfolio for the x86 platform.

Lenovo and IBM plan to enter into a strategic relationship which will include a global OEM and reseller agreement for sales of IBM’s entry and midrange Storwize disk storage systems, tape storage systems, General Parallel File System software, SmartCloud Entry offering, and elements of IBM’s system software portfolio, including Systems Director and Platform Computing solutions.

Following the closing of the transaction, Lenovo will assume related customer service and maintenance operations. IBM will continue to provide maintenance delivery on Lenovo’s behalf for an extended period of time.

Yang Yuanqing (Chairman and CEO, Lenovo): This acquisition demonstrates our willingness to invest in businesses that can help fuel profitable growth and extend our PC Plus strategy.

Steve Mills (Senior vice president and group executive, IBM Software and Systems): This divestiture allows IBM to focus on system and software innovations that bring new kinds of value to strategic areas of our business, such as cognitive computing, Big Data and cloud.

The transaction is subject to regulatory requirements and customary closing conditions.

[Image: IBM System x general manager Adalio Sanchez speaking at an IBM event in Beijing. Courtesy: IBM]

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