by Adam Armstrong

IBM To Acquire Red Hat

Over the weekend IBM announced that it would be acquiring Red Hat for $34 billion. I believe this is the largest tech acquisition of 2018 and perhaps the largest software acquisition to date. The acquisition will make IBM the largest Hybrid Cloud Provider in the world. 

Through acquiring Red Hat, IBM will have the resources to help its customers along their cloud journey, i.e. securely moving most to all of their business applications to the cloud. The combined company will be better positioned to accelerate hybrid multi-cloud adoption. IBM will retain Red Hat’s open governance, open source contributions, participation in the open source community and development model. The Red Hat team will be joining IBM in its Hybrid Cloud team as a distinct unit, preserving the independence and neutrality of Red Hat’s open source development heritage and commitment, current product portfolio and go-to-market strategy, and unique development culture.

The boards of both companies have approved the acquisition though it is still subject to Red Hat shareholders and regulatory approval. IBM will use a combination of cash and debt to acquire Red Hat.

IBM

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