IBM to acquire FileNet for $1.6B

10.08.2006
In an effort to beef up its presence in enterprise content management, IBM said Thursday it was buying FileNet Corp. for US$1.6 billion in cash.

According to market research firm IDC, IBM was third in enterprise content management, with $291 million in revenue, and Costa Mesa, Calif.-based FileNet was second, with $293 million, according to 2005 figures. Combined, they would overtake EMC Corp., currently the leader with $362 million.

IBM said it would combine FileNet's operations with IBM's Content Management business in the Information Management unit led by General Manager Ambuj Goyal, with the goal of preserving and enhancing user investments in both platforms.

The company also said it would integrate its business process management and service-oriented architecture technologies with the FileNet platform.

IBM has said it is investing $1 billion in research in an initiative it calls Information on Demand, of which it considers enterprise content management a key component.

The acquisition is subject to FileNet shareholder approval and regulatory reviews and is expected to close in the fourth quarter of 2006.