IBM to acquire PwC Consulting for $3.5 billion

IBM said today that it would buy PwC Consulting, the consulting and technology services of PricewaterhouseCoopers, for $3.5 billion in cash and stock.

The two companies said they have signed a definitive agreement that has been approved by IBM's board of directors and New York-based PricewaterhouseCooper's leadership board.

The deal, which is subject to regulatory approval and the consent of local PricewaterhouseCoopers firms, is expected to close around the end of the third quarter, according to a statement issued by the two companies.

"Clients are not only looking for innovative ideas to improve their businesses, they are seeking a partner with deep business expertise and the ability to exploit leading open standards-based technology to turn these ideas into bottom-line business benefits," said Samuel J. Palmisano, IBM's president and CEO, in the statement. "This acquisition underscores our commitment to this strategy."

Those comments were echoed later this afternoon during a conference call in which IBM and PwC officials discussed the deal.

"The focus of IBM's strategy is to deliver superior value to clients through the integration of technology and business processes," said IBM's chief financial officer, John Joyce. "Today's acquisition underscores IBM's commitment to this strategy."

Let me say clearly this is not just to grow our service business through an acquisition," said Doug Elix, IBM Senior VP & Group Executive for Global Services. "This will create a new and unique organization to assist clients in using information technology to improve business performance.

"This new organziation will be unmatched in its ability to deliver this value," Elix said.

Greg Brenneman, PwC's president and CEO, touted the move as a good one for customers, who will be able to tap a wide range of IBM capabilities, including leading edge technologies, research innovation and financing services as a result of the purchase.

PwC in June said it would change its name to "Monday" when it launched an initial public offering in a bid to separate itself from PricwaterhouseCoopers (see story). PwC Consulting will no longer pursue its public offering, the company said.

Computerworld's Jaikumar Vijayan contributed to this report.


Copyright © 2002 IDG Communications, Inc.

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