International Business Machines Corp, world’s largest computer-services provider, agreed to buy Telelogic AB for 5.2 billion kronor ($743 million), adding software design systems used by DaimlerChrysler AG and ABB Ltd.
IBM offered 21 kronor in cash for each Telelogic share, about 21 per cent more than the closing share price on May 31 before speculation that Telelogic may be bought started, the Malmoe, Sweden-based company said on Monday in a statement.
The US company has bought more than 50 companies since the start of 2003, mainly in software, to bolster its most profitable unit and counter slower growth in services and hardware. Armonk, New York-based IBM will add more than 1,000 customers, including General Electric Co, who use Telelogic’s products to manage operations from e-mail traffic to project risk analysis.

Sales growth
Telelogic, which employs about 1,160 people, had sales of 1.52 billion kronor last year, an 18 per cent increase from the previous year, with most revenue coming from the Americas region and Europe, the Middle East and Africa. The company targets sales growth of 7 per cent to 12 per cent this year, based on local currency, a forecast it raised in April.
IBM Chief Executive Officer Sam Palmisano is buying software companies to expand IBM’s most-profitable unit and to counter slower growth in services. IBM’s software division earned 25 cents on each dollar of sales last year, compared with 12 cents on the dollar for the company overall. After completion of transaction, Telelogic will become part of IBM’s Rational Software unit. The Telelogic board, which together holds about 0.5 percent of shares and votes, unanimously recommends the offer.