IBM buys Merge Healthcare to boost its medical services

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IBM buys Merge Healthcare to boost its medical services

International Business Machines (IBM) agreed to buy Merge Healthcare for $1 billion, to incorporate the medical company’s imaging management platform with its Watson data analytics tool.

Merge’s shareholders will receive $7.13 a share, a 32 percent premium to Wednesday’s closing price. The all-cash deal, subject to regulatory review and approval from Merge’s investors, is expected to close later this year, the companies said Thursday in a statement.

IBM is bolstering its health care services business, centered around a new business unit called Watson Health Cloud. Finding new sources of revenue has become increasingly important as demand for older services and technology has waned, dragging down sales for 13 straight quarters.

If completed, the acquisition would be the third-biggest for Ginni Rometty since she became IBM’s chief executive officer early in 2012, according to data.

It falls behind the $2 billion takeover of cloud company SoftLayer Technologies in 2013 and the purchase of workforce technology provider Kenexa for $1.2 billion a year earlier.

The Merge acquisition includes the assumption of the health care imaging company’s debt, according to IBM spokesman Steve Tomasco. Bloomberg

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