August 3, 2006 5:04 AM PDT

IBM to shell out $740 million for MRO Software

IBM plans to spend $740 million in cash to acquire MRO Software, a company that builds applications for managing industrial equipment.

Bedford, Mass.-based MRO Software has customers in the manufacturing, utility and transportation industries that use the company's so-called asset management tools for keeping tabs on physical assets such as power plants and refineries.

In the past two years, MRO Software has expanded into IT asset management as well, a company representative said Thursday.

IBM said it will incorporate the asset management tools into its Tivoli line of systems management software. MRO Software will operate as a business unit within Tivoli.

Increasingly, corporations are seeking products to manage both their IT assets and other physical equipment and facilities, said Al Zollar, general manager of IBM's Tivoli division.

"Our clients are telling us they want a consistent way to manage all their assets," Zollar said. MRO Software "really complements the work we do with IT service management and what we are doing with IBM Global Services."

He added that industrial equipment is starting to be networked with embedded chips and radio frequency identification devices, which means they can be managed much the way servers and storage equipment are.

MRO Software's products are built using a services-oriented architecture, or SOA, which will make product integration easier, the companies said.

The two companies have been partners since 1996, when IBM acted as a systems integrator in implementing MRO Software.

The acquisition comes one day after IBM bought Webify Solutions, which builds SOA software for the insurance and finance industries.

IBM's software group has been a consistent acquirer of both large and small companies over the past 10 years, having made more than 50 acquisitions.

IBM intends to rehire MRO Software's roughly 900 employees. The acquistion is expected to close in the fourth quarter of this year.

See more CNET content tagged:
MRO Software Inc., asset management, IBM Corp., asset, SOA


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