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HCL acquires several IBM products

HCL acquires several IBM products
HCL acquires several IBM products

In the biggest tech acquisition by an Indian company, HCL Technologies has acquired select IBM products with an addressable market of $50 billion. The deal was signed for $1.8 billion.

The software products that were acquired by HCL under the agreement are

  • Notes & Domino suite of collaboration software, including email and rapid application development
  • AppScan – web security testing and monitoring tools, formerly known as IBM Rational AppScan
  • BigFix secure remote device management software
  • Unica enterprise marketing management and automation software
  • Commerce – Part of WebSphere suite, software platform framework for e-commerce
  • Portal – Also part of WebSphere suite, used to build and manage enterprise web portals
  • Connections – Web 2.0 compliant enterprise social software applicatio

Looking to future or overpaying

While HCL’s CEO believes the acquisition will add to HCL’s revenue and the investment in in growing areas like Security, Marketing and Commerce. 

We continue to see great opportunities in the market to enhance our Mode-3 (Products and Platforms) offerings. The products that we are acquiring are in large growing market areas like Security, Marketing and Commerce which are strategic segments for HCL. Many of these products are well regarded by clients and positioned in the top quadrant by industry analysts,

C Vijayakumar, President & CEO, HCL Technologies

But the reaction from market has been negative with the stocks tumbling by almost 8% wiping out $1.5 billion off HCL’s market capital, with analysts questioning the acquisition when HCL already had a partnership with IBM for most of the products.

For IBM, the deal is win-win as it adds some cash after its 34 billion acquisition of Red Hat, also reduces the burden of its legacy business as it moves towards cloud computing.

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