IBM Made a Play for Informatica Before Salesforce (CRM) Snatched It—Here’s Why It Matters
Big Blue’s quiet courtship of data-management giant Informatica slipped under the radar—until Salesforce swooped in with a bigger checkbook. The enterprise tech arms race just got hotter.
Behind the scenes: IBM’s bid signals a desperate scramble for cloud dominance as legacy players bleed market share. But in the end, even a 110-year-old titan can’t outspend SaaS royalty flush with subscription cash.
Cynical take: Another 'strategic acquisition' that’ll be written off in 3 years when the next CFO needs to hit margin targets. Happy synergies!
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Interestingly, IBM’s attempt to buy Informatica fits in with its broader strategy of growing its software and hybrid cloud businesses through acquisitions. In fact, IBM has made several major deals in recent years in order to strengthen its position in this space. This includes acquiring Red Hat for $34 billion in 2019, Apptio for $4.6 billion in 2023, and HashiCorp for $6.4 billion earlier this year. Therefore, trying to acquire Informatica was a logical next move.
Nevertheless, Salesforce’s successful purchase now gives it a stronger foothold in the fast-growing data integration market. Unsurprisingly, this area is becoming increasingly important as companies look for better ways to manage and connect data across multiple systems. With this acquisition, Salesforce improves its ability to compete with other major tech firms that are also investing heavily in cloud and enterprise software.
What Is the Target Price for IBM?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on IBM stock based on eight Buys, five Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average IBM price target of $260.62 per share implies 4.2% downside risk.
