IBM ends 2005 with buying spree

Firm ends a busy year with a brace of purchases

IBM closed a busy year for IT mergers and acquisitions by agreeing to purchase a brace of firms that will take it deeper into network management and software integration.

For UK IT buyers the better known of the pair is London-founded Micromuse, a provider of network management tools with particular expertise in converged networks.

IBM said it would spend about $865m on combining the Micromuse software with its own Tivoli IT service management technology to help customers reduce complexity.

Experts said that the purchase makes sense for IBM. “Micromuse plugs an obvious gap in IBM’s IT service management portfolio, bringing network discovery, monitoring and fault management capabilities as well as security event management,” said Neil Macehiter of analyst Macehiter Ward-Dutton. “With enterprises grappling with IP-based convergence and new services, such as VoIP and IMS, IBM needed a credible response.”

The Micromuse deal is expected to close by the end of March.

Separately, IBM said it had acquired Bowstreet, a US-based provider of portal-based tools that has 75 staff. The two firms have long worked closely together and Bowstreet’s software integrates with IBM’s WebSphere and Rational developer tools. The acquisition should help IBM boost its status among companies developing service-oriented architectures.

“Last year we saw BEA buy Plumtree and I’m sure that this year we can expect more of the big firms looking to smaller ones for specialist skills in portals and across the application platform,” said Steve Jones, chief technology officer of application development transformation at Capgemini.

Steve Craggs of the Integration Consortium commented, “This is IBM trying to have a sensible portal solution, which so far the company hasn’t really had.”