An agreement has been signed and approved by the boards of both IBM and PwC. IBM will pay an estimated purchase price of $3.5 billion in cash and stock. The transaction, which is subject to regulatory approvals and the votes of local PwC firms, will be concluded around the end of the third quarter of this year.
The acquisition means that about 30,000 workers at PwC consulting will join IBM’s Global Services unit. The new division will focus on offering integrated business solutions. Customers are expected to buy consultancy together with computer hardware and software.
The deal could be a bargain for IBM: Information Week reports that PwC Consulting's projected revenue for 2002 is an estimated $4.9 billion. In 2001, IBM Global Services earned revenues of $35 billion.
The deal also releases PwC consulting from some of its constraints as part of an accounting firm.
Doug Elix, senior vice president and group executive of IBM Global Services said: “This is an exceptionally good fit – both strategically and culturally. Our businesses complement each other and we speak the same language.”
In 2000, Hewlett-Packard withdrew an offer to buy PwC’s consulting division for $18 billion.