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IBM sold some software products and assets from its Watson Health business to Francisco Partners, a private equity firm. The deal’s announcement came on Friday, a year after reports first came out that IBM was entertaining the notion to sell the unit.

In February of 2021, The Wall Street Journal (WSJ) reported that executives considered taking the unit public by merging with a blank-check company.

WSJ reported in February that Watson Health brought in annual revenues of about a billion dollars but was considered an unprofitable division within IBM.

What will change hands

In a more recent report published by Axios earlier this January, sources cited said IBM was looking to get at least $1 billion for the business.

IBM and Francisco Partners did not say what the financial terms for the deal were in their announcements. However, they shared details about what assets will go over to the private equity firm.

Francisco Partners bought the unit’s Health Insights platform used by organizations to analyze data generated during operations. The firm also bought several software products used in processing medical images, in addition to the Social Program Management, Micromedex, and Clinical Development product lines.

Get lean, go fast?

The sale will allow IBM to set its sights on boosting revenue growth by gaining more market share in the hybrid cloud and artificial intelligence markets.

Last year, IBM did something similar when it spun off its managed infrastructure business, which is now an independent holding company listed on the Nasdaq stock exchange called Kyndryl Holdings.

IBM has not taken its eye off the health market since its subsidiary, Red Hat Inc., has a significant presence in the healthcare sector with software products.