The European Commission has given its approval to IBM Corp.'s purchase of PwC Consulting, the consulting division of accountancy company PricewaterhouseCoopers LLP (PwC), it was announced Monday.
The Commission determined that the deal would not decrease competition in the sector as IBM's share of the IT services market would "not be significantly altered" by the acquisition, the Commission said in a statement.
Earlier this month, the partners of PwC approved IBM's proposed US$3.5 billion purchase of the global management consulting and technology services company, four days after the 30-day regulatory waiting period required under U.S. law expired without a request for additional information about the merger. IBM, of Armonk, New York, announced in late July its intention to purchase PwC Consulting in an effort to boost the services division within IBM Global Services. The deal, which is expected to be finalized in October, would make 30,000 PwC employees and partners part of the Business Innovation Services unit within IBM Global Services.
Earlier this year, IBM said it planned to cut about 14,000 jobs within the division and has publicly indicated that an undetermined number of PwC Consulting employees would be laid off should the merger be finalized.
IBM is primarily active in the markets for IT systems, equipment, software and services on a global basis, while PwC Consulting is PwC's global management consulting and technology services division, the Commission said.
In its assessment of the sale, the Commission determined that IBM is "probably the supplier with the broadest range of IT products and services available in-house," but that the addition of PwC Consulting would not give IBM market dominance.