International Business Machines Corp. (NYSE: IBM), the No. 2 computer maker, said it will pay about $1.6 billion to acquire Kenexa Corp. (NYSE: KNXA), for its human-resources software cloud technologies.
The move appears to bolster IBM's initiatives in the sector against Oracle (Nasdaq: ORCL), the No. 1 database developer, Salesforce.com Inc. (NYSE: CRM) and private Workday, whose managers filed PeopleSoft, not a part of Oracle.
IBM, of Armonk, N.Y., said it expects to close the transaction next quarter. Rudy Karsan, CEO of Kenexa, of Wayne, Pa., said "the customer is the big winner here." The company employs 2,800 people in 21 countries to support about 8,900 customers.
Shares of IBM fell 31 cents to $197.46 at the Monday opening, as Kenexa shares soared more than 40 percent to $45.75, up $13.36, just slightly below IBM's $46 bid price.