Confirmed: Lenovo buys IBM’s low-end server division for $2.3 billion

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IBM has finalized the sale of their low-end data center division to Lenovo for $2.3 billion. Lenovo will be bringing 7,500 employees on board and will oversee server models that use the x86 chip instruction set along with networking switches.

Lenovo will gain ownership of the System x, BladeCenter, and Flex System blade servers and switches along with the x86-based Flex integrated systems, NeXtScale, and iDataPlex servers. Of the $2.3 billion purchase, $2 billion will be paid in cash and the rest of the balance will be paid in Lenovo stock. The two companies are also going to work together to resell some of IBM’s hard disk and tape storage products.

“This acquisition demonstrates our willingness to invest in businesses that can help fuel profitable growth and extend our PC Plus strategy,” stated Yang Yuanqing, chairman and CEO, Lenovo. “With the right strategy, great execution, continued innovation and a clear commitment to the x86 industry, we are confident that we can grow this business successfully for the long-term, just as we have done with our worldwide PC business.”

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