NEW YORK ( TheStreet) -- IBM (IBM - Get Report) edged lower Thursday, after it announced plans to acquire  Merge Healthcare (MRGE) in a $1 billion transaction. EMC (EMC) jumped on reports that it was considering a sale of the company to VMware (VMW - Get Report), in which it holds a majority stake. 

IBM dipped 0.15% to close at $156.36.

Big Blue fell after it announced plans to purchase medical imaging company Merge Healthcare, in a move to bolster its ability to use its supercomputer Watson to analyze medical data and information. IBM plans to integrate Merge Healthcare's technology into its Watson Health Cloud.

"Medical images are some of the most complicated data sets imaginable, and there is perhaps no more important area in which researchers can apply machine learning and cognitive computing," said John Kelly, senior vice president of IBM Research and Solutions Portfolio, in a statement.

IBM launched the Watson Health initiative in April and, including the Merge acquisition announcement, has made three acquisitions for this effort, according to a Forbes report.


EMC jumped 1.3% to finish the session at $27.21, on a day when the broader markets retracted.

The storage giant, according to a report in re/code, is considering a transaction that would allow VMware to acquire it, although EMC is the majority shareholder of VMware. Other options the company has weighed include a sale to Cisco Systems (CSCO - Get Report), Hewlett-Packard (HPQ - Get Report) and other companies, according to re/code.

Pressure from activist shareholder Elliott Management is partially playing a roll in EMC's move to consider a sale of itself, according to re/code.

The mechanism for an EMC-VMware transaction could potentially entail VMware issuing new debt and using the cash to float out new shares that would be exchanged for EMC shares, according to the report.

Meanwhile, Credit Suisse raised its EMC price target to $34 from $30, citing the company's ability to follow "multiple paths" to increase shareholder value, according to a report in Benzinga. Credit Suisse specifically pointed to EMC doing a traditional spin-off of its VMware stake and noted it could drive the company's shares as high as $38, according to Benzinga.


Silicon Graphics surged 13.6% to close out the day at $5.77.

The data management and analytics company spiked by double digits after it beat analysts' fiscal fourth-quarter estimates. SGI posted a loss of 12 cents a share on revenue of $152.90 million, compared to Wall Street's estimates of a loss of 20 cents a share on revenue of $133.71 million, according to a report in Dakota Financial News.

Despite surpassing analysts' expectations, Needham & Co. cut its SGI price target to $10 a share from $13 a share, according to Dakota Financial News. An Associated Press report noted that since the start of the year, SGI's shares have plummeted 55%.

 

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.