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IBM in $6.5bn move for Sun

IBM is in advanced talks to acquire rival Sun Microsystems for roughly $6.5bn (€4.8bn) in cash , in a deal that could mark the start of wider consolidation in the technology industry as the recession shakes out weaker companies.

The acquisition would enable IBM, one of a handful of cash-rich companies to navigate the downturn so far largely unscathed, to cut costs sharply and bolster its computer hardware business in the slow-growing server market.

It would also loosen Microsoft’s strong grip on parts of the server business and mark the end of Sun, a former Silicon Valley darling, after its struggle against shrunken demand and an over-reliance on computer hardware.

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This article was originally posted on FT.com

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