IBM announced that it has entered into a definitive agreement with Vista Equity Partners to buy Apptio, a leader in financial and operational IT management and optimization (FinOps) software, for $4.6 billion. The acquisition of Apptio is going to accelerate the advancement of IBM’s IT automation capabilities and enable enterprise leaders to deliver enhanced business value across technology investments.
Organizations have been digitally transforming their businesses faster than ever, causing IT environments to expand across public and private clouds with multiple service providers. And to manage this dramatic increase in complexity, clients are turning to Apptio’s solutions for integrated and simplified visibility into technology spend across hybrid and multi-cloud environments, labor, and associated resources. Plus Apptio – together with IBM’s IT automation software and it’s watsonx AI platform – will help businesses around the world manage and optimize enterprise IT spending and derive financial value and operational improvement.
Apptio is known as an established, growing, and profitable technology business management and FinOps leader with more than 1,500 clients, serving over half of the Fortune 100. Apptio partners and integrates with leading companies such as Amazon Web Services, Microsoft Azure, Google Cloud Platform, Salesforce, ServiceNow, Oracle, and SAP, consistent with IBM’s commitment to an open partner ecosystem.
Apptio enables enterprise leaders to manage technology spending and direct investments to high-value cloud innovation and digital transformation. And the company has three core offerings, all delivered as software as a service (SaaS) – ApptioOne, Apptio Cloudability, and Apptio Targetprocess:
1.) ApptioOne – Hybrid cloud spend management and optimization capabilities to analyze, optimize and plan IT spending and value. And ApptioOne is used to establish repeatable and accurate planning and financial management processes, delivering actionable insights around cost and utilization, while benchmarking against industry peers for continuous optimization.
2.) Apptio Cloudability – Public cloud spend management visibility and optimization capabilities, connecting multi-cloud and SaaS infrastructure with cloud financial management best practices to maximize the value of clients’ cloud strategy.
3.) Apptio Targetprocess – Agile investment planning capabilities to align development resources to business outcomes, plan and track value delivery for projects or products.
Apptio and the performance optimization and observability capabilities of IBM’s IT automation software such as Turbonomic, Instana and AIOps will give clients a 360-degree technology business management platform, providing a “virtual command center” for spend management and optimization stretching across their entire technology landscape. And Apptio will bring to IBM $450 billion of anonymized IT spend data, unlocking new insights for clients and partners.
The acquisition of Apptio is a continuation of IBM’s deep focus and investment in hybrid cloud and AI and is expected to drive significant synergies across several key growth areas for IBM, including automation, Red Hat, IBM’s broader AI portfolio, and IBM Consulting, and strong partnership with other leading systems integrators like Accenture, KPMG, Deloitte and EY. Plus IBM will also deliver new innovation by augmenting watsonx with Apptio’s anonymized FinOps data. Apptio is expected to benefit from IBM’s long-established scale and reach, working with clients and partners across more than 175 countries.
Apptio is going to be acquired with available cash on hand. And the transaction is subject to regulatory approvals and other customary closing conditions and is expected to close in the latter half of 2023.
KEY QUOTES:
“Technology is changing business at a rate and pace we’ve never seen before. To capitalize on these changes, it is essential to optimize investments which drive better business value, and Apptio does just that. Apptio’s offerings combined with IBM’s IT automation software and watsonx AI platform, gives clients the most comprehensive approach to optimize and manage all of their technology investments.”
— Arvind Krishna, CEO and chairman, IBM
“Our customers are evolving to a complex digital-first, hybrid world where technology investments are distributed and decentralized but all innovation must be aligned with clear business outcomes. We are so excited to be joining IBM and combining our industry leading offerings with IBM’s global presence and strong portfolio across AIOps, automation and hybrid cloud offerings.”
— Sunny Gupta, Apptio co-founder and CEO
“We are committed to building resilient enterprise software companies, which has proven to be highly attractive to strategic and financial buyers, as well as public markets. Our investment philosophy, value creation strategy, and industry expertise, enables us to identify and partner with companies that have the potential for long-term success. Apptio has transformed how leading organizations optimize their IT spend and performance for better outcomes. We are proud of these shared accomplishments and look forward to seeing Apptio further evolve with IBM.”
— Robert F. Smith, founder, chairman and CEO of Vista Equity Partners
