In a blog post, Granger announced that IBM has signed a definitive agreement to acquire application modernization capabilities from Advanced (formerly Advanced Computer Software Group Ltd.), the UK's largest providers of business software and services serving 20,000 global customers with an annual turnover of over £330 million. Advanced's application modernization division is headquartered in Atlanta, the U.S. state of Georgia, and is a global provider of application modernization services with unique expertise in the legacy modernization market.
"Application Modernization" is the practice of updating older software for newer computing approaches, including newer languages, frameworks and infrastructure platforms.
Founded in 2008, by Brit business-woman Vinodka "Vin" Murria, Advanced was acquired by US-based private equity firm Vista Equity Partners in 2015. Murria sold Advanced for £765 million to Vista Equity Partners in 2015 and subsequently it was sold again in Sept 2019 for £2 billion with Vista and BC Partners now the owners.
IBM said that this acquisition will bring a combination of talent, tools and knowledge to enhance IBM Consulting’s mainframe application and data modernization services.
The planned acquisition will further enable IBM to support clients’ mainframe application modernization journeys, marking another important step forward in IBM’s hybrid cloud and AI strategy.
Post acquisition, the application modernization capabilities team of Advanced intended to join IBM Consulting works with global enterprise clients to modernize their mainframe applications and brings more than 30 years of experience, tools and expertise supporting clients’ mainframe strategies and application modernization agendas through an array of mainframe application modernization services, including assessment and design; mainframe transformation and integration; and full deployment. They are also equipped with industry expertise across the financial services, insurance, automotive, travel and transportation, government, utilities and media sectors.
In the blog post Granger said, "Digital transformation is not an “either-or” process of choosing between cloud vs. mainframe. A hybrid cloud approach that includes and integrates mainframe computing can drive up to five times the value of a public cloud platform alone. Yet, modernizing mainframe code and data can be a complex process. In working with our clients, we’ve seen how the right IT services partners can help navigate and speed their transformation journeys, protect their vital investments, and reduce risks surrounding security, data gravity and costs".
The planned acquisition’s services offerings aim to complement the capabilities of 'IBM watsonx Code Assistant for Z', enabling IBM to deliver more comprehensive options for mainframe application modernization across hardware, software and services. Watsonx Code Assistant for Z is a generative AI-assisted product built to help accelerate mainframe application modernization.
The capabilities IBM Consulting intends to acquire together with 'watsonx Code Assistant for Z' aim to improve end-to-end application developer lifecycle, including application discovery and analysis; code refactoring; and code conversion, so applications can better integrate with an enterprise’s hybrid cloud architecture.
The acquisition transaction is subject to customary closing conditions. IBM is expecting that the transaction will close in the second quarter of 2024. Financial details of the transaction were not disclosed.
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