IBM has agreed to acquire data infrastructure company Confluent for $11bn in cash, as the technology firm seeks to strengthen its data and automation capabilities amid rising demand from companies migrating to the cloud and deploying artificial intelligence.
Deal Terms and Valuation
IBM said it will pay $31 per share for Confluent, representing a premium of about 50% over the company’s closing share price on Friday before the acquisition was announced. The transaction is expected to be completed in cash.
IBM said it expects the acquisition to contribute positively to earnings before interest, taxes, depreciation and amortisation, as well as to free cash flow, within two years of the deal’s completion.
Confluent’s Role in Real-Time Data Management
Confluent provides a platform that enables enterprises to manage and process streams of data in real time. This capability has become increasingly important as companies build and deploy AI systems that require continuous movement of data for inference and operational workloads.
IBM said Confluent’s technology will complement its existing data and automation offerings and enhance its portfolio across AI, automation, data management, and consulting services.
Part of a Broader AI-Focused Expansion Strategy
The Confluent acquisition marks IBM’s largest purchase in several years and follows its $2024 acquisition of HashiCorp. The company has pursued a series of partnerships and smaller deals as part of its broader push into AI and next-generation computing.
In October, IBM signed an agreement with AI laboratory Anthropic to integrate the Claude large language model into selected IBM products. It has also partnered with AMD to develop a computing architecture that combines quantum systems with AI-focused chips. In June, IBM acquired data analysis startup Seek AI.
Featured image credits: Wikimedia Commons
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