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IBM to acquire Netezza for $1.7 billion

Saying the time is right to push data analytics deeper into businesses, IBM offers $27 per share for Netezza, with which it already has a long-standing relationship.

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Jon Skillings Director of copy editing
A born browser of dictionaries and a lifelong New Englander, Jon Skillings is director of copy editing at CNET. He honed his language skills as a US Army linguist (Polish and German) before diving into editing tech publications back when the web was just getting under way. He writes occasionally, on topics from GPS to James Bond.
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IBM announced today that it plans to acquire analytics company Netezza in a cash deal valued at about $1.7 billion.

The two companies have entered into a definitive agreement under which IBM will pay $27 per share for Marlborough, Mass.-based Netezza.

Netezza, which has about 500 employees, offers a data-warehousing appliance designed to help businesses handle high-performance analytics. In a joint statement, IBM touted the ease of installing Netezza's appliance as a way to quickly get analytics into the hands of department-level units such as sales, product development, and human resources.

"IBM is bringing analytics to the masses," Steve Mills, senior vice president and group executive of IBM Software and Systems, said in the statement. "Netezza strongly complements our business analytics capabilities and client base."

Netezza's clients include eHarmony, Neiman Marcus, Time Warner, Estee Lauder, Nationwide Insurance, and Virgin Media.

IBM and Netezza have a long-standing relationship through which they've assembled systems designed to analyze large amounts of complex data.

The field is one that has grabbed IBM's attention in a big way. The company said that in the last four years it has invested more than $12 billion in 23 analytics-related acquisitions--for instance, Coremetrics in June of this year and SPSS in July 2009--and that in its second quarter of 2010 its analytics business grew 14 percent.

The acquisition still requires approval by Netezza's shareholders, but IBM expects the deal to close in the fourth quarter.