IBM and SPSS Inc. recently announced that the two companies have entered into a definitive merger agreement for IBM to acquire SPSS, a publicly-held company headquartered in Chicago, in an all cash transaction at a price of $50/share, resulting in a total cash consideration in the merger of approximately $1.2 billion. The acquisition is subject to SPSS shareholder approval, applicable regulatory clearances and other customary closing conditions. It is expected to close later in the second half of 2009.

This acquisition is expected to further expand IBM's Information on Demand (IOD) software portfolio and business analytics capabilities, including the range of offerings available through IBM's recently-announced Business Analytics and Optimization Consultingorganization and network of Analytics Solution Centers. The acquisition is also expected to strengthen IBM's Information Agenda initiative, which helps companies turn information into a strategic asset.

As companies attempt to control costs and use resources more wisely, IDC estimates that the worldwide market for business analytics software will swell to $25 billion this year, growing 4% over 2008.(1)

IBM is expanding its focus on business analytics technology and services to meet growing client needs to cut costs, reduce risk, and increase profitability through predictive analytics capabilities, which include advanced data capture, data mining and statistical analysis. These capabilities help organizations analyze trends and patterns found in historical and current data to drive new forms of competitive advantage by predicting potential future outcomes and optimizing all elements of their businesses, including product and service offerings for customers.

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