IBM's board of directors approved the previously announced separation of the company’s managed infrastructure services business into a new company called Kyndryl.
Kyndryl's mission is to design, run and manage the most modern, efficient and reliable technology infrastructure for the world's most important businesses and organizations. The company will have 90,000 employees worldwide upon spin out from IBM.
To effect the separation the IBM board of directors declared a pro rata distribution to IBM stockholders of 80.1 percent of the outstanding shares of Kyndryl. Once distributed, each holder of IBM common stock will receive one share of Kyndryl common stock for every five shares of IBM common stock held on October 25, 2021, the record date for the distribution. The distribution is expected to occur after close of market on November 3, 2021. IBM will retain 19.9 percent of the shares of Kyndryl common stock, with the intention of exchanging those shares for IBM debt during the 12-month period following the distribution, subject to market considerations.
“Today’s announcement is a milestone for IBM, its employees and its shareholders as we enter a new era of growth,” said Arvind Krishna, IBM chairman and chief executive officer. “The separation of Kyndryl is a significant step in the continued evolution of IBM, a company now squarely focused on delivering powerful hybrid cloud and AI solutions and capabilities to enterprises around the world.”
“Kyndryl has an important and exciting mission – to design, build and manage the technology infrastructure that the world depends on each day,” said Martin Schroeter, Kyndryl chairman and chief executive officer. “As an independent and focused services leader, Kyndryl will be at the heart of progress for our customers.
Kyndryl is organized into six global managed services practices:
- Cloud
- Applications, Data & AI
- Security & Resiliency
- Core Enterprise & zCloud
- Network & Edge
- Digital Workplace
- In September, Kyndryl baned Martin Schroeter as Kyndryl board chairman. Schroeter was IBM's senior vice president of global markets before leaving IBM in June of 2020 and before that he served as the chief financial officer from 2014 to 2017.
