IBM acquires AT&T Sterling Commerce in $1.4bn cash deal

International Business Machines (IBM) Corporation, has finalized a deal to purchase the business software unit, Sterling Commerce, from AT&T in an all cash deal valued at $1.4-billion.

The unit develops B2B software that makes communication between businesses more efficient by automating redundant tasks such as refilling inventory orders from suppliers, among other automated tasks businesses can customize to their needs, even through cross channels.

According to AT&T, the unit has 18,000 global customers, with more than 1-billion interactions on an annual basis across various sectors including manufacturing, retail and financial services.

 IBM said today in a statement, “This acquisition will give IBM new tools to help clients build dynamic business networks that connect partners,”

AT&T has sold Sterling Commerce with an impairment loss after SBC Communications acquired the business for $3.9-billion in ten years ago.

AT&T will post a pretax gain of about $750-million in the period the acquisition finalizes.

No job cuts are expected as a result of any consolidation; rather, current employees will simply be transferred to the IBM WebSphere unit where Sterling Commerce will be integrated with at the company.

The IBM stock (NYSE:IBM) is trading down almost 1.15-percent down to $124 per share in early morning trading.

The AT&T stock (NYSE:T) is also trading down, by more than 2-percent to $24.3 per share.