IBM Expands Vendor Financing Options for Manufacturers and Suppliers of Non-IBM Equipment, Software and Services

IBM (NYSE: IBM) today announced that it is expanding its vendor financing scope by offering financing capabilities to non-IBM manufacturers and suppliers in fast-growing industries. IBM Global Financing (IGF), the lending and leasing arm of IBM, will work with these companies to develop working capital financing, inventory financing and extended payment agreements to improve their access to and use of capital to drive incremental customer sales. It is one of the largest extensions of IBM's Global Financing business since the company first began offering equipment leases on IBM PCs and servers in the mid-eighties.

"As companies become more globally integrated and trade efficiencies become more critical, IBM is making a difference by helping manufacturers and suppliers more actively manage their working capital to unlock money trapped in their supply chains," said John Callies, general manager of IBM Global Financing. "IBM is expanding its business scope to provide a platform of commercial and client financing offerings to business partners and other companies to achieve their business goals in both our primary IT domain and in adjacent market spaces."

According to IDC Research Director, Technology Financing & Management Strategies Joseph Pucciarelli, as IT technology continues to grow in sophistication, other types of equipment have become increasingly IT-centric such as point-of-sale devices, medical imaging equipment, and communications hardware. Together, he says they fuel a worldwide-wide leasing and financing market that exceeds $125 billion annually -- an incredible market opportunity by every measure.

Some of the key areas currently being investigated by IBM Global Financing include the Industrial, Communications and Distribution sectors. Through these vendor financing arrangements, IGF will work with manufacturers, suppliers, resellers and other companies to help them create further competitive differentiation and increased business value for their customers.

IBM Global Financing's expansion is representative of similar moves in other parts of the business that are earning the company its leadership position as the "innovator's innovator." IBM is focused on helping clients unlock value across their entire enterprise: For example, through its IBM Global Business Services and IBM Global Technology Services divisions the company is aligning with its business partners to diagnose, design, build and operate business processes for its customers, including supply chain optimization and financing.

IBM Global Financing has traditionally provided financing to resellers and business partners for non-IBM hardware, software and services as part of an IBM solution. In contrast, these new deals extend the reach of IBM's financing arm above and beyond IBM solutions, leveraging the company's multitude of client relationships to add financing offerings that appeal to a wider variety of businesses looking to maximize returns on invested capital, drive sales and provide budgeting flexibility for their clients.

IBM signaled its expansion strategy to the industry recently, through a rapid succession of deals that offer working capital, inventory financing, and end-user leasing to a broader range of non-IBM technology equipment manufacturers and distributors. The deals include agreements with Tech Data, AbsoluteSKY, Juniper Networks and Symbol Technologies.

IBM is best positioned to provide financing expertise to its business partners because of its position as the world's largest IT financier. IBM Global Financing has a worldwide asset base of nearly $31 billion, serving 125,000 clients in more than 40 countries. Since the launch of this division in the mid-eighties it has focused exclusively on helping companies manage their capital structures through leasing, lending and IT disposition initiatives.

"Many existing financiers approach the market from either a customer or supplier viewpoint," says Pucciarelli. "IBM Global Financing, by virtue of its requirement to provide financing for customer solutions, brings a new focus to this marketplace -- solutions financing. This new orientation will undoubtedly challenge the status quo and likely result in a broader range of leasing and financing options for commercial companies worldwide."

About IBM Global Financing

IBM Global Financing (IGF), the financing business segment of IBM and the world's premier single-source provider for multi-vendor IT financing solutions, serves commercial clients ranging from small businesses to more than 90% of the Global Fortune 100. With assets of $31 billion worldwide, IGF provides project financing, commercial financing and asset-recovery services to 125,000 clients in more than 40 countries. Additional information can be found at http://www-03.ibm.com/financing/us/

LISTEN: Mark Young, IGF Strategic Alliances and New Vendor Financing Programs Executive for comments on how IBM's expansion of vendor financing options are a logical extension of the business and a compelling value proposition to manufacturers and suppliers of non-IBM equipment.