IBM said on Tuesday it is buying SoftLayer, as the computing giant aims to bolster its cloud computing efforts.
While financial terms of the deal were not disclosed, The Wall Street Journal said the acquisition is worth around $2 billion, citing a person familiar with the deal.
IBM will create a new cloud services division within its Global Services unit that will house SoftLayer as a standalone company. It will act as a junction box between other cloud services the company owns.
Big Blue says the acquisition will help it to beef up its ability to integrate public and private clouds for its clients, which will enable small to medium-sized businesses' overall performance and security benefits.
In prepared remarks, IBM Global Technology Services senior vice-president Eric Clementi said: "With SoftLayer, IBM will accelerate the build-out of our public cloud infrastructure to give clients the broadest choice of cloud offerings to drive business innovation."
IBM chose SoftLayer because it makes it easier and faster for Big Blue's clients to incorporate the speed and simplicity of SoftLayer's public cloud services with IBM's SmartCloud portfolio, which offers enterprise-grade security and reliability. It will also help IBM expand its OpenStack range by further committing to open standards, like Linux.
Dallas, Texas-based SoftLayer was founded in 2005. The company now serves an estimated 21,000 customers across the U.S., Europe, and Asia, from its 13 datacenters.
The acquisition is expected to close in the coming third-quarter.