The move is part of Big Blue’s moves to streamline the company and become more competitive in cloud computing.

IBM is studying alternatives for the unit that could include a sale to a private-equity firm or industry player or a merger with a blank-check company, the people said.

The unit, which employs artificial intelligence to help hospitals, insurers and drug makers manage their data, has $1 billion in annual revenue and isn't currently profitable, the people said. Its brands include Merge Healthcare, which analyses mammograms and MRIs; Phytel, which assists with patient communications; and Truven Health Analytics, which analyses complex healthcare data.

It isn't clear how much the business might fetch in a sale, and there may not be one. IBM, with a market value of $108 billion, has been left behind as cloud-computing rivals Microsoft and Amazon.com soar to valuations more than 10 times greater.

Big Blue said it's focused on boosting its hybrid-cloud operations while exiting some unrelated businesses.