IBM to acquire Octo to boost its US government business

IBM
has
announced
it
is
acquiring
US-based
digital
transformation
services
provider
Octo
for
an
undisclosed
amount
from
private
equity
firm
Arlington
Capital
Partners.

[…]

IBM to acquire Octo to boost its US government business

IBM
has
announced
it
is
acquiring
US-based
digital
transformation
services
provider
Octo
for
an
undisclosed
amount
from
private
equity
firm
Arlington
Capital
Partners.
 

Octo
exclusively
serves
the
US
federal
government,
including
its
defense,
health,
and
civilian
agencies,
boosting
IBM’s
ability
to
expand
its
presence
in
this
highly
lucrative
segment.

The
deal,
which
is
expected
to
close
in
the
fourth
quarter
of
this
year,
will
see
Octo’s
1,500
employees
join
IBM
Consulting’s
US
public
and
federal
market
organization,
taking
its
total
staff
count
to
4,200
employees.

The
US
federal
government
agencies,
according
to
Big
Blue,
currently
face
significant
challenges
including
technology
skill
shortages
leading
to
delay
in
responding
to
demand
for
citizen
services
and
rebuilding
the
country’s
supply
chain
network.

The
US
Federal
Government
has
been
investing
heavily
in
IT
modernization
and
cybersecurity,
with
an
estimated

budget
of
$65
billion
 
for
2023
for
civilian
IT
spending,
according
to
a
White
House
report.

This
opens
up
opportunities
for
digital
transformation
service
providers
such
as
IBM
to
help
US
federal
agencies
leverage
emerging
technologies
and
applications
to
optimize
costs
and
operational
efficiencies
while
improving
security,
IBM
said.

On
Wednesday,
the
US
Department
of
Defense
announced
it
is
awarding
a

five-year
cloud
computing
contract
worth
up
to
$9
billion

to
IBM,
Amazon,
Google
and
Oracle.

Octo,
which
provides
services
across
artificial
intelligence,
cloud
and
infrastructure,
DevSecOPs,
data
management
and
analytics,
and
cybersecurity,
also
runs
a
14,000
square
foot
innovation
center
called
oLabs,
which
IBM
plans
to
use
for
co-creation
with
federal
agencies,
and
rapid
prototyping.

The
acquisition
comes
at
a
time
when
IBM
rivals
Google,
Amazon
Web
Services,
Microsoft
and
Oracle
are
locked
in
a
battle
of
gaining
market
share
as
economic
uncertainty
slows
down
enterprise
spending.

Big
Blue’s
acquisition
spree

IBM,
which
has
acquired
close
to
25
companies
till
date,
has
been
on
an
acquisition
spree
since
Arvind
Krishna
took
the
helm
of
the
company
as
CEO
in
2020.
Its
consulting
business
alone
has
acquired
13
companies
to
boost
its
offerings.

In
September,
the
company
announced
the
acquisition
of
product
engineering
services
firm
Dialexa.
In
February,
IBM
acquired
Neudesic
and
Sentaca
to
boost
its
Azure
and
5G
consulting
capabilities
respectively.

In
January
2021,
IBM
acquired
Taos
to
boost
its
cloud
migration
offerings,
followed
by
the
acquisition
of
Nordcloud
in
December
2020
to
accelerate
its
hybrid
cloud
strategy.

In
the
consulting
line
of
business,
which
includes
business
transformation,
technology
consulting
and
application
operations,
IBM
reported
a
total
revenue
of
$4.7
billion
for
the
quarter
ended
September
2022,
an
increase
of
14%
year-on-year.

While
application
operations
and
technology
consulting
revenue
both
saw
an
increase
of
17%,
business
transformation
revenue
grew
by
14%.

Subscribe To InfoSec Today News

You have successfully subscribed to the newsletter

There was an error while trying to send your request. Please try again.

World Wide Crypto will use the information you provide on this form to be in touch with you and to provide updates and marketing.