IBM Doubles Down on Linux: Redhat to join IBM

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RedHat HQ, credit: wikimedia commons

International Business Machines Corp (NYSE: IBM) revealed on October 28 that Red Hat Inc. (NYSE: RHT) has agreed to be acquired in a cash and debt deal valued at nearly $34 billion. IBM will purchase shares of Red Hat for $190 per share, representing a premium of more than 60%. This move comes as part of Ginni Rometty’s, CEO and chairman at IBM, to steer the company towards more modern business ventures. Rometty stated, “The acquisition of Red Hat is a game-changer. It changes everything about the cloud market.” He added, “We will scale what Red Hat has deeply into many more enterprises than they’re able to get to.” Goldman Sachs and JPMorgan Chase acted as financial advisers to IBM and provided financing for this transaction. Paul, Weiss, Rifkind, Wharton & Garrison acted as legal adviser to IBM. Morgan Stanley and Guggenheim Partners served as financial advisers to Red Hat.

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