EMA Impact Brief:
IBM Acquires Algorithmics, Deepening Expertise in Risk Analysis and Management

Date: 09/19/2011

Length: 3 pages

Cost: $25.00

Abstract:
On September 1, 2011, IBM announced its intention to acquire Algorithmics, a leading vendor of risk analysis and management solutions for financial businesses, for $387 million in cash (subject to price adjustments at closing). The acquisition will provide significant expertise in financial risk analytics and management to the IBM Business Analytics unit, but touches on aspects of interest to a potentially much wider swath of concern across the spectrum of enterprise Governance, Risk Management and Compliance (GRC). Algorithmics aligns well with IBM on multiple fronts. Its success among financial enterprises directly supports a high customer priority in one of IBM's key markets. Algorithmics complements the company’s investment in OpenPages for enterprise GRC, and is a provocative follow-on to the announcement of IBM's acquisition of threat intelligence aggregation and analysis vendor i2 only the day before. Together, Algorithmics and i2 suggest the range of expertise in risk analysis and management that could potentially drive the development of more mature approaches to risk analytics in fields where they are desperately needed, such as operational risk and security analytics, complementing IBM’s strategic interest in the continuing rise of "Big Data" and its long-term organic investment in deep yet responsive data mining and intelligence.