IBM is acquiring property and construction group Lend Lease’s 23% stake in IBM Global Services Australia Ltd for AUD 160m ($102m), which consists of AUD 80m ($51m) on completion of the sale and the balance in 12 months.
The IT services giant is also buying state-owned telecoms company Telstra’s 22% stake in IBM GSA for AUD 153.5m ($98m) in a transaction expected to be finalized in early September.
IBM and Lend Lease, its first major Australian client, formed the joint venture then called Integrated Systems and Services Corp in 1994, and it was renamed when Telstra became a partner in 1997.
IBM Global Services employs over 8,000 people in Australia, and according to IDC, it has a 15% share of the country’s IT services market, ahead of rivals EDS Corp, Computer Sciences Corp, and Unisys Corp.
Lend Lease has been considering the sale of its stake in IBM GSA for the last two years, but Telstra’s sale is being driven by a recent revamp of its IT strategy which will see it compete with IBM for large communications and IT services projects under the leadership of former IBM Australia chief David Thodey.
Telstra is also looking to source a larger amount of its IT functions from service providers based in low-cost offshore locations such as India, and IBM looks set to lose a chunk of application software maintenance work from Telstra to companies such as Satyam Computer Services and Infosys Technologies, from which the telco has requested proposals.
Source: Computerwire
