Toshiba to Buy IBM's Point-of-Sale Business

Toshiba Tec Corp., the Japanesemaker of scanners and bar-code machines, will acquireInternational Business Machines Corp.'s point-of-sale terminalbusiness for about $850 million in its biggest acquisition ever.

Toshiba Tec, 50 percent owned by TV and computer makerToshiba Corp., will acquire the Retail Store Solutions business,the companies said in a joint statement today. The deal isexpected to close late in the second quarter or early in thethird quarter, subject to regulatory approvals, it said.

The transaction gives Toshiba a business that had revenueof about $1.15 billion last year and about 1,000 employeesglobally. Retailers use the point-of-sale systems, which includeboth hardware and software, to process and record transactions,manage inventory and collect and analyze data includingcustomers' purchasing trends.

The purchase

"The purchase would strengthen Toshiba Tec's corebusiness," said Mitsushige Akino, who oversees about $600million at Ichiyoshi Investment Management Co. in Tokyo.

Toshiba Tec will use its own money to fund the purchase,spokesman Takashi Mizuno said by phone. The company had 82.05billion yen yen in cash and nearly cash as of Dec.31, according to data compiled by Bloomberg.

Armonk, New York-based IBM, the world's largest computer-services provider, is increasing its focus on software, cloudcomputing and emerging markets as part of a five-year plan thatincludes adding $20 billion in new revenue by 2015.

Major impact for Toshiba Tec

"It will have a major impact for Toshiba Tec," saidHideki Yasuda, an analyst at Ace Securities Co. in Tokyo."Toshiba Tec will be able to expand its POS business with theacquisition, as IBM already has clients and can lure new oneswith its brand."