Feeds

US regulators OK sale of IBM's x86 server biz to Lenovo

Now all that remains is for gov't offices to ban the boxes

Secure remote control for conventional and virtual desktops

US regulators have given the thumbs-up to IBM's sale of its x86-based System x server business to China's Lenovo, Big Blue announced on Friday.

"The approval of the $2.3 billion sale to Lenovo enables IBM to focus on system and software innovations that bring new kinds of value to IBM clients in areas such as cognitive computing, Big Data and cloud, and provides clarity and confidence to current x86 customers that they will have a strong partner going forward," IBM said in a brief but breathless press release.

The sale had been under review by the US Treasury Department's Committee on Foreign Investment in the United States (CFIUS), which examines whether the sale of US businesses to foreign parties could have national security implications.

In June, the Wall Street Journal reported that the CFIUS review was dragging out because US security officials were concerned that Lenovo could give Chinese spies access to IBM servers, perhaps by installing backdoors during routine maintenance.

US officials were reportedly also worried about China getting its hands on IBM clustering technology, which they believed could give the Middle Kingdom a boost in high-performance computing.

The latter concerns were probably unfounded, since China already claims the title of the world's most powerful supercomputer. But some Reg readers may recall that regulators raised similar security issues when Lenovo bought IBM's PC business in 2005.

CFIUS ultimately approved the PC division sale, but even that wasn't enough to satisfy the US State Department, which banned the use of Lenovo-built PCs on secure government networks anyway, over China's objections. Australia, Canada, New Zealand, and the UK reportedly did the same.

There's been no word yet from government sources as to whether these bans will now also extend to System x servers, but in June HP cheekily claimed that it had already won "hundreds" of customers away from IBM since the Lenovo deal was announced in January.

The System x sale was approved by China's Ministry of Commerce in July, which left the CFIUS review as the final government hurdle it needed to clear before going forward.

"The parties now look forward to closing the transaction," IBM said. ®

Internet Security Threat Report 2014

More from The Register

next story
Just don't blame Bono! Apple iTunes music sales PLUMMET
Cupertino revenue hit by cheapo downloads, says report
The DRUGSTORES DON'T WORK, CVS makes IT WORSE ... for Apple Pay
Goog Wallet apparently also spurned in NFC lockdown
Cray-cray Met Office spaffs £97m on VERY AVERAGE HPC box
Only 250th most powerful in the world? Bring back Michael Fish
Microsoft brings the CLOUD that GOES ON FOREVER
Sky's the limit with unrestricted space in the cloud
'ANYTHING BUT STABLE' Netflix suffers BIG Europe-wide outage
Friday night LIVE? Nope. The only thing streaming are tears down my face
Google roolz! Nest buys Revolv, KILLS new sales of home hub
Take my temperature, I'm feeling a little bit dizzy
IBM, backing away from hardware? NEVER!
Don't be so sure, so-surers
prev story

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.
Mitigating web security risk with SSL certificates
Web-based systems are essential tools for running business processes and delivering services to customers.