Authority blocks IBM’s merger plan

THE State competition watchdog has blocked a takeover deal for the first time, throwing out plans by computing giant IBM to merge its specialist disaster recovery business with another major player in the Irish market.

The Competition Authority said yesterday that IBM’s proposed takeover of Schlumberger Business Continuity Services would “substantially lessen” the market for recovery hotsite services, which allow businesses to continue operating from an offsite location if their offices are destroyed or their computer systems stop working.

The deal was originally flagged in April and was part of a global takeover by IBM of Schlumberger’s business continuity operations. Schlumberger is the biggest provider of such services in Ireland, with seven working sites in Dublin, Cork and Belfast. IBM holds the number two position in Ireland with two sites in Dublin and one in Cork.