IBM is reportedly in advanced talks to acquire data infrastructure company Confluent for about $11 billion, a move aimed at improving IBM's ability to capture growing demand for cloud services. The deal could be announced as early as Monday, U.S. time, according to people familiar with the matter.
Confluent is an open source platform for processing massive real-time data streams, from bank transactions to website clicks. Reports emerged in October that Confluent was considering a sale after attracting interest from potential buyers and had hired an investment bank to manage the process.
Confluent has a market capitalization of about $8.09 billion, while New York-based IBM has a market capitalization of about $287.84 billion, according to lSEG.
Investors grew cautious after IBM reported slowing growth in its core cloud software business in October, raising concerns about the company's ability to maintain growth momentum. Analysts said IBM will need stronger software performance to maintain overall growth.
IBM's acquisition strategy remains a key focus in meeting investor expectations. Last year, the company acquired HashiCorp for $6.4 billion, expanding its cloud-based services to meet growing demand driven by artificial intelligence.
Under Chief Executive Officer Arvind Krishna, IBM has stepped up its focus on its software business, aiming to capitalize on increased spending on cloud services.
The interest in Confluent highlights a surge in demand for data infrastructure companies, driven by enterprises racing to develop generative artificial intelligence (GAI). In May, Salesforce agreed to acquire software maker Informatica for about $8 billion to bolster its artificial intelligence capabilities.
