In a significant move within the tech sector, IBM is set to divest assets of The Weather Company, including the widely-used Weather.com and The Weather Channel mobile app, to private equity firm Francisco Partners. The deal, announced on Tuesday, also encompasses The Weather Company’s advanced forecasting science and technology platform, as well as several other digital properties, though the financial terms remain undisclosed.
Purchased by IBM in 2015 for a hefty $2 billion, The Weather Company’s digital assets have been a key part of IBM’s portfolio, although the television network was never part of the acquisition and has been under the ownership of Allen Media Group since 2018. Despite the sale, IBM will continue to hold onto its sustainability software business, including the Environmental Intelligence Suite, and plans to use The Weather Company’s weather data for this technology.
IBM Sells The Weather Company’s Digital Assets to Francisco Partners
Tech giant IBM has announced that it’s selling off digital assets of The Weather Company, including the renowned Weather.com and The Weather Channel mobile app. The buyer is private equity firm Francisco Partners, although the financial details of the transaction have not been publicly disclosed.
A Strategic Shift for IBM
Back in 2015, IBM had acquired the digital assets of The Weather Company, including its mobile app, for a staggering $2 billion. However, the TV-based Weather Channel, currently owned by Allen Media Group, wasn’t part of that deal. This recent sale reflects IBM’s strategic shift towards focusing on artificial intelligence and hybrid cloud technology, according to Rob Thomas, IBM’s senior vice president of software and chief commercial officer.
What Stays with IBM
Despite parting with significant assets, IBM is retaining its sustainability software business, which includes the Environmental Intelligence Suite. The tech behemoth, based in Armonk, New York, also plans to continue using The Weather Company’s weather data for its technology.
The Weather Company’s Far-Reaching Influence
The Weather Company has a robust digital presence, reaching over 415 million people each month through its consumer-facing platforms. The company also serves more than 2,000 businesses through its enterprise offerings, as per the announcement made on Tuesday.
A Deal Set for 2024
The handover of The Weather Company’s digital assets to Francisco Partners is expected to be completed by early 2024, according to the joint statement released by the companies.
Takeaways
This move by IBM underscores its shift in focus towards artificial intelligence and hybrid cloud technology. While it’s selling off significant digital assets, it’s retaining key parts of its business that align with its future strategy. For Francisco Partners, obtaining The Weather Company’s digital business is a significant acquisition, given its substantial monthly reach and extensive enterprise offerings. Overall, this deal is a strategic move for both parties and is likely to shape their trajectories in the tech industry in the coming years.
