IBM to split into two companies
IBM is splitting itself into two separate, public companies - capping a years-long effort by the world’s first big computing firm to diversify away from its legacy businesses to focus on high-margin cloud computing. IBM will spin off the unit that manages the IT infrastructure for clients, including support for data centers. That unit will have a new name by the end of next year.
Chief Executive Officer Arvind Krishna, who also engineered IBM’s $34 acquisition of cloud company Red Hat last year, called the move a “significant shift” in the 109-year-old company’s business model.
In recent years the company has focused on cloud growth, aiming to make up for slowing software sales and seasonal demand for its mainframe servers.
Investors cheered the divestiture move, driving the company’s shares up nearly 9% at the start of trading Thursday.
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