IBM grabs PWC for $3.5 billion

IBM, the biggest provider of services to help companies install and run computer systems, has agreed to buy PricewaterhouseCoopers' consulting arm for an estimated $3.5 billion, the companies said Tuesday.

The transaction is subject to regulatory approvals, but both companies' boards have approved the measure. The deal is expected to close in the third quarter.

The acquisition by IBM, which already has huge presence in the consulting market, will likely affect other companies such as Sun Microsystems, Dell Computer, Hewlett-Packard and EDS that have sought to beef up their own services, said Illuminata analyst Jonathan Eunice.

"As we studied our options, it was always clear to us the best option was to be acquired by IBM," PwC Consulting Chief Executive Greg Brenneman said in a conference call with financial analysts.

IBM Global Services had $35 billion in revenue in 2001, but the acquisition will bolster an area of comparative weakness, planning and installing high-end software for corporate accounting, dealing with customers, and managing corporate supplies, said Forrester Research senior analyst Christine Ferrusi Ross.

News source: ZDNet News - IBM grabs PWC for $3.5 billion

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