IBM Acquires The Weather Company For $2 Billion
Big Blue will soon bolster its Watson business by acquiring the Weather Company
Analysts and experts believe that International Business Machines Corporation will soon become the most accurate platform to let you know about the weather conditions all around the world. IBM, also known as Big Blue, is on the verge to complete acquisition deal of The Weather Company and its assets for a massive $2 billion.
The Weather Company owns a traditional cable TV channels that keeps viewers updated about the weather and the future forecasts. The Weather Company will only sell its digital business, app and website, and data infrastructure. Furthermore, the tech giant will not be taking over the TV channel segment of the weather company. IBM is only interested in acquiring the assets such as data structure and digital technologies for which it will invest as high as $2 billion. It is also believed that the company is more interested to acquire WSI which is a Weather forecasting group.
The WSI group is more than capable to ‘possess technology and weather data that the company gathers, manipulates and licenses to diverse organizations which range from insurance providers to airlines,’ according to a source. Furthermore, both parties were an ally of each other in the beginning of this year as well where they decided to bring new and innovative ways to package and sell weather data.
The Weather Company is not an independent company. It is owned by a consortium which acquired it back in 2008 for a massive $3.5 billion. The consortium includes Comcast Corporation’s NCB Universal which has 25 percent of the company’s ownership. The remaining 75 percent ownership belongs to the private equity firms such as Bain Capital, LLC and Blackstone Group LP.
Sources also suggest that the chief executive of the Weather Company, David Kenny, will be joining the Big Blues once the deal is finalized. This was not mentioned in IBM’s announcement earlier however was confirmed later. Yahoo Finance reported, “The acquired business units will include The Weather Company's B2B, mobile and cloud-based web properties, but will exclude The Weather Channel, which will continue to operate independently, licensing data and analytics from IBM.”
The Weather Company made itself available various times before this in order to give opportunities to other tech giants to acquire it. Previously, Google was named to acquire it but the company mentioned that it is not interested. There were speculations in the beginning of this year regarding this potential deal could happen.
IBM stock was up 0.19% to $140.35 at market close on Monday October 2.
