IBM and EMC fight over Softlayer

IBM and EMC are both trying to buy privately held database web hosting company SoftLayer Technologies.

It has been estimated that the company could be worth about $2 billion.

According to Reuters, SoftLayer has hired Morgan Stanley and Credit Suisse to run the sale process.

Softlayer was founded in 2005, and is supposed to be the the world’s largest privately held website hosting service.

It sells technology to over 25,000 companies, mostly cloud infrastructure to SMEs? Its sale was sparked when one of its customers, AT&T, approached the company in recent months seeking exclusive talks, one of the sources said. AT&T has since walked away, but the idea of a sale is still out there.

SoftLayer, AT&T, EMC, IBM, Morgan Stanley and Credit Suisse declined to comment and Reuters seems to be quoting unnamed insiders.

Web hosting companies have been snapped by the big players over the last few years as they increasingly try to push into cloud services.

EMC has been pushing ahead with its cloud-based software business, announcing a new venture with VMWare called Pivotal, which will combine both companies’ data analytics and cloud application assets.

SoftLayer incluses VMware competitor Citrix Systems as one of its customers. The company is held by GI Partners, which purchased all of the equity in partnership with SoftLayer management in August of 2010.

Softlayers’s biggest competitor, The Planet was merged with SoftLayer in the same year.