IBM to purchase DemandTec

I.B.M. reported this week that they will purchase DemandTec, a web-based enterprise software company, for $440 million. Reasoning for this purchase is likely DemandTec’s standing with both cloud based services and data analytics.

Craig Hayman, an I.B.M. general manager, commented, “The combination of DemandTec and I.B.M. will help marketing and sales executives in retail and other industries drive more revenue and increase profitability.”

As companies shift their focus to cloud computing, they are less dependent on on site software. This change in conjunction with data mining needs is altering business behavior. Industry giants, like IBM and Oracle are buying smaller companies in order to address the shift.

I.B.M. is paying $13.20 a share, 56.6 percent above DemandTec’s closing price on Wednesday. The DemandTec transaction is expected to close in the first quarter of 2012.