IBM Acquires HR Software Manager Kenexa in US$1.3bn Deal

IBM will make its first foray into the human resource (HR) software sector, after agreeing a US$1.3bn cash deal to acquire manager Kenexa.

The deal will see the computing giant pay US$46 per share for the smaller firm at US$1.3bn (£823m) and follows earlier deals that have seen other major tech groups move into the HR management market via acquisition. SAP bought Kenexa’s competitor SuccessFactors for US$3.4bn in December 2011, while Oracle acquired another rival, Taleo, in a US$1.9bn deal in February.

Kenexa offers HR, talent acquisition and talent management software. The product includes recruitment process outsourcing (RPO) that provides global recruitment services; recruitment technology solutions; onboarding solutions, which offer forms management for legal documents, workflow, and electronic signatures; employee assessments that help organisations to select and retain top performers; Kenexa Prove It, a skills test solution to identify and select the talented candidates; and Kenexa Interview Builder, which provides an online structured interview reference library of approximately 3,000 questions; and employment branding solutions.

“Kenexa complements IBM’s strategy of bringing relevant data and expertise into the hands of business leaders within every functional department from HR, sales, marketing to product development,” IBM announced in a release. “The combination of IBM and Kenexa will allow organisations to act on insights driven analytics to create a more intelligent and smarter workforce across every line of business.”

Analysts predicted that the scramble for the social enterprise market was heating up as a result of the latest deal. “This is a big step,” said Rebecca Wetteman at Nucleus Research. “This brings the arms race up a notch.”

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