IBM To Acquire Red Hat… Wow!

IBM has decided to drop $34 billion to acquire Red Hat who are one of the leaders, if not the leader in the enterprise Linux space. According to a joint statement, IBM will pay cash to buy all shares in Red Hat at $190 each. Given that shares of Red Hat were at $116.68 on Friday, that’s one hell of a premium that IBM has to pay to score this company. Red Hat will become a unit of IBM’s Hybrid Cloud division, with Red Hat CEO Jim Whitehurst joining IBM’s senior management team and reporting to CEO Ginni Rometty. So clearly there’s a cloud related play here.

Trust me, this deal is going to get a lot of attention in a lot of places. Most notably in Redmond Washington.

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