IBM Acquires Business Intelligence Firm Cognos

The business intelligence field continued to become less of a stand-alone business today as IBM (NYSE: IBM) announced its intention to acquire Cognos (Nasdaq: COGN) in an all-cash transaction at a price of approximately $5 billion, or $58 per share, with a net transaction value of $4.9 billion.

The acquisition is subject to Cognos shareholder approval, regulatory approvals and other customary closing conditions. It is expected to close in the first quarter of 2008.

In April, Oracle (Nasdaq: ORCL) acquired Hyperion Solutions for about $3.3 billion. Last month, SAP (NYSE: SAP) acquired Business Objects for $6.8 billion. That leaves MicroStrategy (Nasdaq: MSTR) as the only remaining stand-alone business intelligence provider (“Business Intelligence Apps Could Pay for Collectors,” Oct. 17).

MicroStrategy’s owners said in a conference in Chicago last month that they have no intention of being acquired. The company’s senior management has the final say in any such transaction because they own over half of the share voting rights, according to company officials.

IBM said that the acquisition will support the company’s on-demand strategy by combining the company’s information integration, content and data management and business consulting services with Cognos’ business intelligence strength because it will enable new business insights to be delivered to a broader set of people across an organization, beyond the traditional users of business intelligence.

Cognos’ business intelligence and performance management platform operates on an open-standards-based service oriented architecture (SOA), which is consistent with IBM’s approach, the companies said.