IBM's Telelogic bid a done deal



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April 4, 2008 —  IBM has completed its US$845 million acquisition of Telelogic, giving it some more leverage in the post-PC market for software applications in wireless devices, automobiles, home appliances, even robots.

IBM said yesterday that the acquisition, first announced in June 2007, has closed, and that Telelogic is now part of IBM’s Rational division.

Telelogic’s software tools are used in embedded complex systems development, serving such customers as Boeing, Siemens, Sprint and Toyota, IBM said in its announcement. IBM and Telelogic together will offer a stronger link between hardware and software design, better manage systems engineering efforts, ensure standards compliance and coordinate all development team efforts.

IBM took a jab at competitors HP and Microsoft in announcing the Telelogic closing. It compared its software and systems offering to Microsoft’s and stated that Redmond’s “proprietary software strategy and lack of large-scale system development expertise naturally hinders their ability to play in this space.” While HP is building a software portfolio through acquisitions, IBM claimed that HP must “first learn to ‘walk’ in software development before they can ‘run’ in systems development.”

Growth opportunities appear to be better in the non-PC space than in PCs, IBM declared, citing industry research. Venture Development Corporation reported that the market for embedded software development products was $51 billion in 2005, while Embedded Market Forecasters reported that the market for traditional, PC-based software development was only $292 million that same year.

Telelogic, with headquarters in Malmö, Sweden, and Irvine, Calif., has 8,000 customers and 1,200 employees worldwide.

The acquisition was completed when 96.9% of Telelogic shareholders approved of the deal and various global regulatory agencies gave their blessings. The delay in closing the deal pushed the price up from an original $745 million last year, as the declining value of the dollar against the Swedish krona meant IBM had to pay more.





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The company sees its Rational tools as being used in the IT space and Telelogic's tools being used by systems developers. The plan calls for a preservation of Telelogic's tools that developers already use and enjoy Read More...
 
 
 
 
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