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04 April 2008


IBM yesterday achieved the closure of its $845-million acquisition of the Swedish software firm, Telelogic AB, two months after buying business intelligence software maker Cognos for $5 billion.

In June 2007, Big Blue had announced its definitive agreement to acquire Telelogic for $745 million, saying that the acquisition of the Swedish developer of complex software products would complement its own ability to assist customers to develop high-quality complex systems that range from next-generation aerospace,defense, telecommunications, electronics, automotive and other industries .

The tender offer, announced on 11 June 2007 was finalised after IBM obtained acceptance from 96.9 per cent of stock ownership in Telelogic as well as satisfaction of other conditions of the offer, including necessary regulatory approvals in different countries.

The acquisition will boost IBM Rational Software's in developing embedded systems software and help IBM in its service-oriented architecture markets.

Telelogic says the customers of the two companies will benefit from their combined technologies and services , providing them a wide range of software and system development capabilities, along with support from a worldwide sales and services organisation.

For example, an automotive manufacturer would use IBM and Telelogic solutions to help build and deliver software to operate a vehicle's anti-lock braking system or navigation system, whileaerospace and defense organisations could develop and operate advanced satellite radar systems and space telescopes using the combined strengths of the two software firms.

According to Dr Daniel Sabbah, general manager, IBM Rational Software, ''Telelogic is an important element of our software and systems development and delivery strategy. Software is at the heart of embedded devices and systems. Whether it's used to develop the next generation of communication devices or systems for space exploration, this IBM technology has important implications for society.''

Announcing the acquisition agreement between the two companies in June Sabbah had said, "IBMs acquisition of Telelogic serves to accelerate the innovation of products that rely on software. This space includes industries such as consumer electronics, medical systems, automotive, and aerospace and defense. This kind of complex systems development often includes embedded software development. Venture Development Corp. estimates about $51 billion is spent annually on embedded software development."

''Software is driving innovation in the products we use every day-from phones to cars to airplanes. Together, IBM, Telelogic and business partners will expand and accelerate our customers ability to define, model, build, test, deliver and govern the development of these simple and complex systems-with higher quality and faster time to market, while also reducing product cost."

Telelogic will report into the IBM Rational Software unit. Consistent with IBM's Software strategy, Telelogic clients' and partners' investments in existing IBM and Telelogic technologies will be preserved, allowing customers to take advantage of the broader set of capabilities without the need to replace existing systems.