IBM has announced that it has reached a definitive agreement with Red Hat where it will be taking over all the issued and outstanding shares of Red Hat. The acquisition will see IBM buying all of Red Hat shares, $190.00 per share.
IBM has largely focussed on the legacy servers for its business but with this move, the company has taken concrete steps towards securing its future. The company’s CEO Ginni Rometty said that the acquisition is a game-changer. “IBM will become the world's #1 hybrid cloud provider, offering companies the only open cloud solution that will unlock the full value of the cloud for their businesses.”
Together, Red Hat and IBM, with their combined capabilities will be able to help their clients create cloud-native business applications “faster, drive greater portability and security of data and applications across multiple public and private clouds, all with consistent cloud management.”
IBM is acquiring the leading cloud software business for a whopping $34 billion. The acquisition got a nod from the boards of directors of both IBM and Red Hat with shareholders approval. The process of acquisition is expected to be done completely by the end of 2019.
IBM has been declining in popularity over time but this acquisition brings it back into focus. Thus, this acquisition is probably the most important one this year.