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IBM to buy enterprise software maker Lombardi

Big Blue is acquiring the top provider of business process management software, which tries to help companies cut costs by automating their business processes.

IBM is making yet another acquisition, this one a leading provider of business process management software.

Big Blue announced on Wednesday its intention to purchase Lombardi, a privately-held firm that sells business process management (BPM) software and services. BPM is designed to help companies cut costs and improve efficiency by automating and integrating key business processes. This encompasses such areas as product planning, supply chain, product procurement, human resources, and IT services.

Market research firm IDC forecasts that the market for BPM software will reach $3 billion by 2013, up from $1.7 billion this year--a compounded annual growth rate of almost 15 percent.

"Any discussion on business improvement inevitably leads to improving the processes that are at the heart of every company," said Craig Hayman, general manager for IBM Application and Integration Middleware, in a statement. "Recognizing this, IBM has strengthened its presence and investments in business process and integration software to meet these growing client demands. Lombardi fills out our company's portfolio in this key area."

Based in Austin, Texas, with offices in Europe, Lombardi has enjoyed record sales over the past few years. For fiscal 2008, the company's revenues almost doubled, rising 47 percent over those in 2007. Lombardi's customers run the gamut to include financial services, government, health care, insurance, manufacturing, and telecommunications.

Both companies see the acquisition as a nice fit since Lombardi's Teamworks development and Blueprint documentation products already work under IBM's WebSphere environment. The two also enjoy many of the same customers and partners, which should pave the way for a smooth transition. IBM also noted that its existing technologies and those of Lombardi won't be changed, so customers can continue to use their current systems.

"Lombardi's had a long-standing technical partnership with IBM--we were one of the first vendors in the BPM space to deliver a product running on WebSphere," wrote Lombari CEO Rod Favaron in his blog on Wednesday. "We understand IBM's strengths and we know how they complement ours as well. We also know that there is a great fit for both Teamworks and Blueprint into the overall IBM BPM portfolio."

IBM has been on an acquisition streak this past year, trying to beef up its offerings to business customers. The company has so far gobbled up data discovery software firm Exeros, database security firm Guardium, security provider Ounce Labs, and analytics provider SPSS.

Following the usual regulatory approvals, Lombardi will be integrated into IBM. No specific closing date or financial terms were disclosed.