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IBM said Friday it will sell the core data assets of its Watson Health division to a San Francisco-based private equity firm, marking the staggering collapse of its ambitious artificial intelligence effort that failed to live up to its promises to transform everything from drug discovery to cancer care.

Data and analytics assets held by the health business, which was not profitable, were sold to Francisco Partners as IBM seeks to refocus its business on cloud computing and AI services to help clients in multiple industries build machine learning tools and secure and manage their data. Terms of the transaction were not disclosed.


The sale came after IBM spent billions of dollars acquiring health information companies to build a new enterprise aimed at using AI to supply insights to hospitals, pharmaceutical companies and researchers. Those companies — Truven, Merge Healthcare, Explorys, and Phytel — came with an impressive array of patient data and client relationships. But IBM struggled to integrate their data and diverse cultures into a coherent business, causing it to lose clients and miss sales targets.

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