Kyndryl (KD) Announces Portfolio Optimization Actions

Kyndryl (NYSE: KD) today announced that it has acquired privately held Skytap, a leading specialized workload services provider.

"The acquisition of Skytap reflects the proactive steps we're taking to invest in our mission-critical capabilities where our global alliance partnerships and innovation enable us to help our customers transform and grow," said Dave Simpson, Global Practice Leader for Cloud at Kyndryl.

Kyndryl's acquisition of privately held Skytap will expand the Company's hybrid cloud services portfolio. Skytap's innovative technologies will be combined with Kyndryl's expertise in helping customers utilize cloud native services to accelerate the adoption of advanced analytics, artificial intelligence and development, security and operations (DevSecOps). Skytap is recognized as having particularly strong capabilities for transitioning complex workloads to support hyperscaler environments. Skytap's technologies enable customers to move and run their mission-critical systems in the public cloud with minimum change.

Additional Portfolio Optimization

Kyndryl also announced that it has entered into a definitive agreement to divest its transaction processing platform for the securities brokerage industry in Canada, known as Securities Industry Services (SIS), to Broadridge Financial Solutions, Inc. Kyndryl intends to provide managed services and capabilities to Broadridge related to SIS following the divestiture.

Revenues generated by both Skytap and SIS over the last twelve months were less than 1% of Kyndryl's annual revenue. While Kyndryl expects to record a transaction-related gain (excluded from its adjusted results) in conjunction with the SIS divestiture, the transactions have no impact on Kyndryl's fiscal year 2025 outlook, which was provided on May 7, 2024. The Company intends to use the net proceeds from the two transactions for general corporate purposes.

Terms of the transactions were not disclosed. Closing of the SIS transaction is subject to customary closing conditions, including required regulatory approvals.

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