IBM buys Rational in $2.1bn deal


6 December 2002 Computer giant IBM has bought tools vendor Rational Software in a deal valued at $2.1 billion (€2.09bn).

IBM said that the rationale behind the deal was that it wants to be able to integrate software across every segment: from mobile phones to mainframes. Rational will be merged into the IBM Software Group when the deal is completed.

“The software industry, business customers and developers are increasingly demanding software that is based on open industry standards and enables integration – integration of business applications across the enterprise and the value chain of customers and suppliers,” said Greg Mills, senior vice president of the IBM Software Group.

“The combination of Rational and IBM is a logical extension to what has been a very beneficial 20-year relationship and will significantly extend our progress in key markets and customer segments,” said Rational co-founder and CEO Michael Devlin.

Rational is a highly-rated vendor whose tools are used by 98 of the Fortune 100, according to the company.

The deal represents a further step in the consolidation of the computer industry – a process which is expected to intensify in 2003. Analysts at Gartner have suggested that the number of computer and hardware and software vendors will be cut in half by the end of 2004.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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