IBM will pay US$1.2 billion in cash for SPSS, a companywith technology that will bolster Big Blue's business analyticsline-up. SPSS makes predictive analytics and data mining softwarethat models customer interactions.

IBM said the deal, which values SPSS at US$50 a share, is expectedto close in the second half of the year. IBM hascompleted 27 acquisitions for its information on demand strategyand more than 100 deals over the last decade overall.

Coupled with the launch of IBM's preconfigured analytics system,Big Blue appears to be signaling that it's serious about making predictivemodeling part of every day corporate processes.

SPSS will fit into IBM's information on demand softwareportfolio. SPSS targets a bevy of industries including financialservices, health care, retail and the public sector. SPSS' softwareis used to retain customers, detect fraud and analyse risk.

On a conference call, Ambuj Goyal, general manager of IBM'sinformation management business and Jack Noonan, CEO of SPSS,portrayed the deal as complementary. For SPSS, IBM provides moredistribution and services heft. For IBM, SPSS fits into the overallbusiness analytics strategy.

Goyal noted that SPSS and IBM were already partners. Indeed,SPSS' software was embedded in the IBM Cognos business intelligenceapplications via an OEM agreement.