REG-Intnl Bus. Mach IBM Board of Directors Approves Separation of Kyndryl

International Business MachinesAnnouncement

12/10/2021 13:40

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20211012:nBw6n2nnka&default-theme=true


IBM Board of Directors Approves Separation of Kyndryl


 * Record date for distribution of Kyndryl shares will be October 25, 2021

 * Distribution date for Kyndryl shares anticipated to be November 3, 2021

 

IBM (NYSE: IBM
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.ibm.com%2Finvestor&esheet=52507485&newsitemid=20211012005668&lan=en-US&anchor=IBM&index=1&md5=0cc67e459c289328552d7985636a93a8)
) announced today that its board of directors has approved the previously
announced separation of Kyndryl, the company’s managed infrastructure
services business.

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. It is intended
that, for United States federal income tax purposes, the distribution will be
conducted in a tax-efficient manner for IBM stockholders in the United States.
The distribution is subject to certain conditions described in the
registration statement on Form 10 filed by Kyndryl.

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.”

Shareholders do not need to take any action to receive shares of Kyndryl
common stock to which they are entitled as an IBM stockholder. Additionally,
shareholders do not need to pay any consideration, or surrender or exchange
shares of IBM common stock, to participate in the separation.

Forward-Looking and Cautionary Statements

Except for the historical information and discussions contained herein,
statements contained in this release may constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on the company’s current assumptions
regarding future business and financial performance. These statements involve
a number of risks, uncertainties and other factors that could cause actual
results to differ materially, including, but not limited to, the following: a
downturn in economic environment and client spending budgets; a failure of the
company’s innovation initiatives; damage to the company’s reputation;
risks from investing in growth opportunities; failure of the company’s
intellectual property portfolio to prevent competitive offerings and the
failure of the company to obtain necessary licenses; the possibility that the
proposed separation of the managed infrastructure services unit of the
company’s Global Technology Services segment will not be completed within
the anticipated time period or at all, the possibility of disruption or
unanticipated costs in connection with the proposed separation or the
possibility that the separation will not achieve its intended benefits; the
company’s ability to successfully manage acquisitions, alliances and
dispositions, including integration challenges, failure to achieve objectives,
the assumption of liabilities, and higher debt levels; fluctuations in
financial results; impact of local legal, economic, political, health and
other conditions; the company’s failure to meet growth and productivity
objectives; ineffective internal controls; the company’s use of accounting
estimates; impairment of the company’s goodwill or amortizable intangible
assets; the company’s ability to attract and retain key employees and its
reliance on critical skills; impacts of relationships with critical suppliers;
product quality issues; impacts of business with government clients; reliance
on third party distribution channels and ecosystems; cybersecurity and data
privacy considerations; adverse effects from environmental matters, tax
matters; legal proceedings and investigatory risks; the company’s pension
plans; currency fluctuations and customer financing risks; impact of changes
in market liquidity conditions and customer credit risk on receivables; risk
factors related to IBM securities; and other risks, uncertainties and factors
discussed in the company’s Form 10-Qs, Form 10-K and in the company’s
other filings with the United States Securities and Exchange Commission or in
materials incorporated therein by reference. Any forward-looking statement in
this release speaks only as of the date on which it is made. Except as
required by law, the company assumes no obligation to update or revise any
forward-looking statements.

IBM 

Tim Davidson, 914-844-7847 

tfdavids@us.ibm.com (mailto:tfdavids@us.ibm.com)



View source version on businesswire.com:
https://www.businesswire.com/news/home/20211012005668/en/
(https://www.businesswire.com/news/home/20211012005668/en/)

IBM


Copyright Business Wire 2021