Global technology company IBM will reportedly discontinue its direct operations in Nigeria, Ghana, and several other African countries.
The company has decided to transfer its business functions in the region to MIBB, a subsidiary of Midis Group, which will take over the sale and support of IBM’s products and services across 36 African nations starting 1 April 2025.
With over five decades of presence in Nigeria, IBM was a big partner in sectors such as banking, telecommunications, oil and gas, and government. The company provided high-end computing and storage solutions to financial institutions like Zenith Bank.
However, in recent years, the competitive space has shifted, with firms such as Dell and Huawei expanding their reach in Nigeria’s banking sector. This growing competition, coupled with economic challenges, has contributed to IBM’s decision to restructure its African operations.
IBM’s decision to withdraw from direct operations in West Africa follows a trend among multinational corporations reconsidering their presence in Nigeria due to the country’s economic difficulties.
The devaluation of the naira, growing inflation, and shrinking consumer purchasing power have made it more difficult for global firms to sustain operations. In 2023, the Manufacturers Association of Nigeria (MAN) reported that 767 manufacturing companies shut down, while hundreds more struggled due to economic instability.
Several multinational companies, including Kimberly-Clark, Pick n Pay, and Diageo, have exited Nigeria in 2024, pointing to unfavourable economic conditions.
For IBM, this exit aligns with its global financial challenges. The company reported an 8% decline in infrastructure sales and a 2% drop in consulting revenue in 2024, even though software sales grew by 10%, contributing to an overall 1% revenue increase. IBM’s global strategy now focuses on restructuring operations for more sustainable growth.
The transition of IBM’s African operations to MIBB leaves us wondering how businesses and government institutions that have relied on IBM’s solutions will be affected.
While MIBB will continue to market and sell IBM products, the shift could lead to challenges in terms of service continuity and support. The long-term impact is uncertain, and some experts are concerned about whether MIBB will maintain the same level of service and expertise that IBM provided.
Nonetheless, IBM projects a 5% revenue growth in 2025, backed by a projected free cash flow of $13.5 billion. But its departure from direct operations in Nigeria and other African countries points to a change in priorities as it scales through both regional and global challenges.
For now, businesses and institutions that have depended on IBM must prepare for a new operational model under MIBB, adjusting to the changing technological space in Africa.
