IBM has announced it will acquire Cognitus, a Dallas-based SAP S/4HANA services provider known for its industry-specific and AI-powered solutions. The agreement aims to expand IBM's digital transformation capabilities by integrating Cognitus' expertise in SAP implementations and application maintenance.

Cognitus, founded in 2002, is recognized as an SAP Gold & Co-innovation partner. The company specializes in end-to-end SAP S/4HANA projects and offers proprietary software assets endorsed by SAP. These include tools such as Cognitus CIS-GovCon for government contracting, an AI-powered contract lifecycle management solution (Cognitus CLM), a low-code data migration tool, and real-time billing software.

According to IBM, the addition of Cognitus will enhance its asset-based approach to digital transformation and help clients improve productivity and operational efficiency. Neil Dhar, Managing Partner at IBM Consulting Americas, stated: "SAP is the foundation for so many digital transformations around the world. Clients are turning to trusted partners that know their industries inside and out and can deploy AI-powered solutions to their enterprise operations. Cognitus brings deep industry expertise and proprietary AI technology that improves the efficiency of SAP implementations and will extend the functionality of tools across our SAP portfolio."

Pat Sathi, CEO of Cognitus, commented on the acquisition: "Becoming part of IBM enables Cognitus to amplify what we do best – accelerating SAP transformation through innovation. It creates new opportunities for our people while strengthening how we serve our customers. Our clients will continue to benefit from our proven SAP-Endorsed solutions and accelerators, backed by Cognitus' deep industry expertise in regulated industries and now supported by IBM's global scale and advanced technology capabilities."

Nitin Khanna, Managing Director, and Amit Baid, President at Cognitus added: "Our software-first approach has always been central to how we deliver value. With IBM, we'll be able to accelerate software innovation, enhance our portfolio, and expand these capabilities to serve an even broader global customer base."

IBM says this move strengthens its position with strategic partners including AWS, Microsoft, Oracle, Palo Alto Networks, and SAP itself.

The financial terms of the deal were not disclosed. The acquisition remains subject to customary closing conditions and regulatory approvals.