It didn’t take long for IBM to announce its first acquisition of 2012: Big Blue has agreed to buy software testing firm Green Hat.

Green Hat enables developers to test software applications in the cloud before they are deployed, which IBM says can reduce risk and improve software quality as well as shorten development times.

Doing the testing in the cloud removes the need to invest in an expensive and time-consuming lab made up of both hardware and software components. IBM says using Green Hat’s technology, the testing cycle can be reduced from weeks to days and is significantly cheaper.

It works by creating a virtualised testing environment that can replicate a variety of IT infrastructure elements. IBM says this means testing can be done at an earlier stage of the development cycle, and at more regular intervals. This can remove the "scrap and rework" approach to development.

IBM says there is a need for this sort of technology as currently customers can spend up to 50% of their development resources on testing, and 30% of that goes on managing the complexity of the test environment itself.

Green Hat will sit within IBM’s Relational Software division and will form part of its Collaborative Lifecycle Management platform.

"We’ve been focused on transforming our customers’ software development processes through innovative testing and quality improvements," said Peter Cole, CEO, Green Hat. "We are looking forward to bringing Green Hat’s innovative application virtualisation and continuous integration testing expertise to IBM customers who have a growing business need to better manage their complex testing environments."

Green Hat is jointly headquartered in London and Wilmington, Delaware in the US and has offices in Germany and Australia. Its customers include BNP Paribas, Deutsche Bank, Virgin Mobile, British Airways, BAA and the London Borough of Ealing.

Financial details of the deal were not disclosed. The acquisition is expected to close during Q1 2012.