IBM’s businesses’ future seems so bleak right now. You may have perhaps heard about the news that the technology corporation is looking at selling the weather business it owns for a whopping over $1 billion.
Apparently, it has also been said that this possible sale could lead to massive staff layoffs, which have also challenged other tech companies lately.
Possible sale of IBM’s weather business for over $1 billion
As International Business Machines Corporation continues to reshift its focus on software and cloud services, it is reportedly looking at selling its weather business.
Referencing people with this matter, The Wall Street Journal reported yesterday that though the company is looking at a possible sale, the discussions are still in their early phases. It could also be probable that a deal may not occur.
However, options on the table include auctioning this weather business, as an unmentioned private-equity company is likely buying it should a sale happens. The deal could be valued at over $1 billion.
IBM’s weather business has been present since 2015
It was in 2015 when IBM entered the weather business after it acquired the Weather Co. in a $2 billion deal. The acquisition comprised Weather Co.’s business-to-business and web properties based on the cloud, WSI, Weather Underground, weather.com, and The Weather Co. brand. The Weather Channel is not part of the deal since IBM entered into a long-term agreement to provide weather data to it.
During that time of the acquisition, it was claimed it was big data, and the Internet of Things play by the company. Over the eight years of owning this weather business, IBM has been able to enhance its weather services, including adding information from smartphones and aircraft to strengthen its weather forecasts.
Lowest share price
This decision to possibly sell its weather business also came amidst reports IBM had its lowest share price in more than two decades. The technology company’s move to divest its non-core assets actually started in January 2022 when it sold a wide range of its software products and more of its assets from its Watson Health business to Francisco Partners, a private equity firm.
Moreover, IBM also sold legacy infrastructure unit, Kyndryl Holdings, Inc. The bad luck does not end there. IBM likewise said it could lay off around 3,900 employees, with many of the reductions focused on those who remained after units had been divested, James Kavanaugh, IBM’s chief financial officer, said. Kyndryl is a managed infrastructure business spun out of IBM last 2021.
The sale of its weather business could result in similar staff layoffs, media reports said.
