) --

SoftLayer Technologies

, the Texas-based cloud infrastructure provider majority owned by private equity firm GI Partners, will be acquired by New York tech company


(IBM) - Get Report


Specifics of the deal were not publicized, but one source familiar with the transaction estimated the price tag to be approximately $2 billion.

The New York Times

first reported the deal's cost.

Also see: 5 Steps Toward Modernizing Your Financial Statements

The deal is set to close in the third quarter.

IBM, led by chairwoman and CEO Virginia Rometty, also announced Tuesday that it would launch a new cloud services platform that will incorporate SoftLayer's offerings with IBM's SmartCloud.

The latest series of moves for the Armonk, N.Y.-based tech titan is seen as an effort to directly compete with companies such as


(AMZN) - Get Report

, which, with its Web services platform, has developed a multibillion-dollar business through services such as Web marketing, cloud infrastructure and data analysis. "Competitors are going to need M&A like this to keep pace with Amazon" Web services, one industry insider suggested.

GI Partners acquired SoftLayer along with the company's management in an August 2010 deal; the PE firm would later merge it with


DH Capital

was financial advisor to the company when it was first acquired by GI Partners.

The Daily Deal

reported in January that GI Partners, as majority stakeholder, had begun testing the market for a sale of SoftLayer and that the anticipated deal value of the company ranged from $1.5 billion to $2 billion.

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Past deals in the space include last year's

Cogeco Cable

deal for

Peer 1 Network Enterprises

, at 13 to 15 times EBITDA, and


(CTL) - Get Report

$3.2 billion deal for


in 2011, at 9 to 11 times EBITDA.

A Moody's Investors Service report projected SoftLayer would generate $425 million in 2013 revenue.

IBM's deal comes as M&A in the tech industry has bolstered otherwise uninspiring deal volume and values for 2013. With leveraged buyouts of companies including

BMC Software





, and


(DELL) - Get Report

, public markets have more often seen underperforming technology companies being removed from exchanges, than strategics striking deals for private companies.

However, that could be changing, especially as technology and competition force more and more companies to compete on mobile platforms:


(CRM) - Get Report

agreed Tuesday to buy out marketing software company


(ET) - Get Report

for $2.5 billion.

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IBM generally doesn't use financial advisers, but took legal advice from

Cravath, Swaine & Moore's

Eric Schiele. SoftLayer turned to Chris Bartlett at

Morgan Stanley

(MS) - Get Report

for financial advice and a

Kirkland & Ellis

team including David Breach, Travis Nelson, John Lynn and associate Amber Meek for legal counsel.

Chris Nolter and David Marcus contributed to this report.