The board of directors of IBM (NYSE: IBM) has approved the planned separation of its managed infrastructure services business to form an independent public company that will operate as Kyndryl.
IBM said Tuesday it will distribute 80.1 percent of Kyndryl’s outstanding shares to IBM stockholders on a pro rata basis to help carry out the separation.
Stockholders will get a share of common stock in the spinoff company for every five shares of IBM common stock held as of the distribution record date of Oct. 25.
The New York-based technology company expects the distribution date for Kyndryl shares to occur on Nov. 3, subject to certain conditions stipulated in the Form 10 registration statement.
IBM said it will keep 19.9 percent of the shares of common stock in Kyndryl and plans to exchange those remaining shares for IBM debt in the 12 months following the distribution’s completion.
In October 2020, IBM announced its move to spin off its managed infrastructure business as part of its efforts to focus on hybrid cloud and artificial intelligence capabilities.
Kyndryl appointed 10 business leaders to its board of directors in late September two months after it unveiled the members of its senior leadership team, operating model and global structure.