IBM will accelerate hybrid cloud growth strategy to drive digital transformations and separate the Managed Infrastructure Services unit into a new public company (NewCo), according to press release. The spin-off will create two industry-leading entities with separate strategic focus and flexibility to enhance shareholder and client value.

  • The spin-off to be effected on a pro-rata, tax-free basis to IBM shareholders and will be completed by the end of 2021
  • “IBM is laser-focused on the $1 trillion hybrid-cloud opportunities,” -Arvind Krishna, IBM CEO
  • IBM to focus on open hybrid cloud platform and AI capabilities while NewCo to have greater agility to design, run, and modernize the infrastructure of the globe’s leading organizations 
  • Both companies to focus on improved growth, partnering, and capturing new opportunities capitalizing on their respective strengths.
  • After separation, both companies will pay a combined quarterly dividend, no less than IBM’s pre-spin dividend per share.

IBM stock is gaining on the proposed spin-off.  IBM: NYSE is up 7.39%