Red Hat, best known for its Red Hat Enterprise Linux operating system will now be owned by IBM.
The deal which is worth USD $34 billion was announced today. Red Hat is an open source software which is used by thousands of users that include Major enterprise level companies including Oracle. IBM has long been a big user of and contributor to Linux and other open source projects. IBM would buy all Red Hat common shares at $190 apiece — 63 percent above Red Hat’s closing price Friday. Ginni Rometty, IBM’s chairman, president and CEO, says the acquisition would make IBM the world’s No. 1 hybrid cloud provider throwing a major challenge to Amazon cloud and Microsoft cloud platform. Red Hat will help IBM with that effort because it is a leading provider of open-source software and services that help companies bridge different platforms, she said.
Red Hat started in 1993, with its headquarters previously on the North Carolina State University campus. Red Hat has grown into the dominant provider of the Linux operating system to corporations. While Linux is available free of charge, Red Hat sells a version of Linux that contains software enhancements and the high level of technical support that corporations require. Today it has 12,600 workers worldwide in more than 35 countries. This is going to be IBM’s largest ever acquisition.