IBM said this afternoon it would buy Canada's Cognos for $5 billion in a deal what would see it snap up the last major independent maker of business intelligence software.
IBM said it signed the deal to buy the company for $58 a share, a 9.5 per cent premium to its Friday closing price of $52.98 on the Nasdaq. IBM expects the deal to close in the first quarter of 2008.
Investors had expected the deal after SAP bid €4.8 billion ($6.8 billion) for Cognos rival Business Objects in October, and Oracle acquired Hyperion Solutions in April for $3.3 billion.
All three targets make software that combs through vast amounts of data to analyse business trends.
Cognos's US shares rose to $57.06 in Nasdaq trading on Monday morning and have gained 27 per cent since the SAP deal for Business Objects on October 7th. IBM shares rose nearly 1 per cent to $101.61 on the New York Stock Exchange.
Oracle, SAP and now IBM are investing in business intelligence software to boost the allure of their product portfolios.