IBM reportedly in talks to acquire Sun Microsystems


International Business Machines Corp. (IBM) is in talks to buy Sun Microsystems in a deal that would expand its server market share, it was reported today.

The transaction would strengthen IBM’s position against Hewlett-Packard Co., and strengthen its influence on the Internet.

According to the Wall Street Journal, if the negotiations are successful, IBM is likely to pay at least $6.5 billion to acquire the Santa Clara, California based company.

That would be the largest acquisition in IBM’s history, surpassing the purchase of Cognos last year. That amount of money would be nearly double Sun’s closing share price on Tuesday of $4.97 per share.

The report cautioned that while the two companies are holding discussions, a transaction may not occur.

Meanwhile, an IBM spokesperson declined to comment on the reported negotiations, which she described as “rumor and speculation”.