IBM buying Confluent for $11 billion in AI push
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IBM on Monday agreed to buy Confluent, a Mountain View, California-based data center infrastructure firm, for $11 billion in cash.
Why it matters: This reflects CEO Arvind Krishna's belief that IBM's path to maintaining relevancy in the AI age is via open-source acquisitions.
- He put together the Red Hat deal shortly before becoming CEO in 2020, and in the past year has acquired both Hashi and Confluent.
- IBM's stock price has more than doubled during that time.
By the numbers: IBM will pay $31 per Confluent share, representing a 34% premium over Friday's closing price.
- Confluent went public in June 2021 and saw its shares peak later that year at $93.60.
The bottom line: "IBM has been competing with Google, Microsoft and a number of startups to build computers that exceed the abilities of the best conventional ones. It is working on larger clusters of quantum chips that it expects will enable large-scale computing in the next five years." — Lauren Thomas, WSJ
