IBM announces the largest acquisition in its history, a history spanning 107 years. Armonk's company entered into an agreement with Red Hat, a leading open source cloud company best known for its enterprise operating system, Red Hat Enterprise Linux.
The deal is worth $34 billion and, according to IBM's note, it will make the transition to cloud computing easier and faster among large IT customers. IBM will become the world's largest hybrid cloud provider. Not only that, thanks to this operation, IBM also expects a strong increase in revenues.
Red Hat is a company founded in 1993, known to the general public for Linux. Over the decades, however, the company has also specialized in technologies for cloud services.
The acquisition has already received the approval of the boards of directors of both companies and will now have to pass through the scrutiny of Red Hat's shareholders, but above all of the regulatory bodies. In case of "double Yes", the operation will close in the second half of 2019.
“The acquisition of Red Hat is a market-changing operation…. IBM will become the world's number one hybrid cloud provider, offering the only open cloud solution that will enable companies to unlock the full value of the cloud for their business,” said the IBM chief executive officer.Ginni Rometty in a statement.
As mentioned, Rommetty's company will disburse $34 billion, equal to $190 a share in cash, with a 62% premium over Red Hat's stock closing on Friday.
After shedding 1,3% on Friday, IBM shares are down 1,3% on the NYSE as the stock Red Hat even earns 47,43%% (-3,4% on Friday), going from 116,68 to 171,85 dollars.
(Last update: 16.00 am on 29 October).
