HP is set to announce a $13-billion acquisition of EDS (Electronic Data Systems) later on today.
EDS is known primarily as a consulting and outsourcing organisation – both areas where HP has not traditionally been strong.
HP, which makes money mainly from computer hardware and software, had revenues last year of $104-billion. In 2006, it posted revenue from consulting services at $16,4-billion. IBM dominates that market, with $48,3-billion, with EDS and its $21,3-billion a distant second.
This will be HP's largest acquisition since it bought Compaq six years ago, for $20-billion. More recenlty, it bought Mercury Interactive for $4,6-billion and Opsware for $1,6-billion.
EDS, which was formed by former IBM employee Ross Perot in 1962, performs a wide range of services, from managing companies' IT systems to helping them man their contact centres.