IBM has entered into an agreement with Lenovo that will see that latter acquire IBM’s low-end x86 server business following hardware sales declines for the enterprise IT incumbent spanning nearly two years. The acquisition, valued at roughly $2.3bn, will likely help refocus the company on its new initiatives including cloud, big data, and cognitive computing as a service.
As part of the agreement IBM will shed its SystemX, Flex Systems and Blade servers to Lenovo, and retain its higher-end hardware including System z mainframes, Power Systems, Storage Systems, Power-based Flex servers, and PureApplication and PureData appliances.
Lenovo will assume customer service and maintenance operations for systems it has taken on, and IBM will shed 7,500 personnel – all of which will be offered positions with the Chinese OEM.
At $2.3bn, it is the largest Chinese acquisition of an American technology provider to date.