The Wall Street Journal reported on Sunday that IBM is entering advanced discussions to acquire data-infrastructure company Confluent for about $11 billion, aiming to boost Big Blue’s ability to capture the growing demand for cloud services.
Moreover, the newspaper reported that unnamed sources said IBM could announce the deal for Confluent—an open-source platform that processes massive streams of real-time data, from bank transactions to website clicks—as early as Monday. Both companies did not issue any immediate response to requests for comment outside normal business hours.
Previously, in October, Confluent began weighing a potential sale and appointed an investment bank to manage the process after drawing interest from prospective buyers.
As per LSEG-compiled data, Confluent holds a market capitalization of about $8.09 billion, while New York-based IBM carries a valuation of roughly $287.84 billion.
However, investors grew cautious after IBM reported slower growth in its core cloud software business in October, raising concerns about the company’s ability to maintain momentum. Analysts said IBM will need stronger software performance to keep overall growth on track. Furthermore, IBM’s acquisition strategy remains a key focus for meeting investors’ expectations. Last year, the company bought HashiCorp in a $6.4 billion deal, expanding its cloud-based offerings to capture rising demand fueled by artificial intelligence.
Under Chief Executive Arvind Krishna, IBM continues sharpening its focus on software, aiming to capitalize on increased spending on cloud services.
Additionally, the interest in Confluent highlights a surge in demand for data-infrastructure companies, fueled by the corporate race to develop generative artificial intelligence. In May, Salesforce agreed to acquire software maker Informatica for about $8 billion to bolster its AI capabilities.
Shares of Mountain View, California-based Confluent closed lower at $23.14 on Friday.
