IBM Corp. is selling its healthcare data and analytics business, part of Watson Health, to the global investment firm Francisco Partners, the companies announced Friday.
Armonk, New York-based IBM and San Francisco-based Francisco Partners have signed a definitive agreement and expect the deal to close in the second quarter of this year, subject to customary regulatory approvals. The companies did not disclose financial terms.
"Today's agreement with Francisco Partners is a clear next step as IBM becomes even more focused on our platform-based hybrid cloud and AI strategy," Tom Rosamilia, IBM Software's senior vice president, said in a statement. "IBM remains committed to Watson, our broader AI business, and to the clients and partners we support in healthcare IT."
Francisco Partners has invested in more than 400 technology companies over its two decades in business, including eSolutions, Capsule, GoodRx and Zocdoc.
"We have followed IBM's journey in healthcare data and analytics for a number of years and have a deep appreciation for its portfolio of innovative healthcare products," Ezra Perlman, co-president of Francisco Partners, said in a statement. "IBM built a market leading team and provides its customers with mission critical products and outstanding service."
Under the deal, the current management team will continue in similar roles in the new standalone company serving its existing clients.
The news comes after IBM sold three components of its Watson Health portfolio to the group purchasing organization Vizient in 2020: ActionOI, CareDiscovery and Market Expert.