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You are here: Home / Red Hat soar on IBM deal

Red Hat soar on IBM deal

· October 29, 2018 ·

Updated 7:39 am PDT, Monday, October 29, 2018
  • FILE- In this April 26, 2017, file photo, pedestrians walk past the IBM logo displayed on the IBM building in New York. Shares of Red Hat skyrocketed at the opening bell Monday, Oct. 29, 2018, after IBM, in the biggest acquisition in its 100-year history, acquired the software company. less
    FILE- In this April 26, 2017, file photo, pedestrians walk past the IBM logo displayed on the IBM building in New York. Shares of Red Hat skyrocketed at the opening bell Monday, Oct. 29, 2018, after IBM, in the … more

    Photo: Mary Altaffer, AP

Photo: Mary Altaffer, AP

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FILE- In this April 26, 2017, file photo, pedestrians walk past the IBM logo displayed on the IBM building in New York. Shares of Red Hat skyrocketed at the opening bell Monday, Oct. 29, 2018, after IBM, in the biggest acquisition in its 100-year history, acquired the software company. less
FILE- In this April 26, 2017, file photo, pedestrians walk past the IBM logo displayed on the IBM building in New York. Shares of Red Hat skyrocketed at the opening bell Monday, Oct. 29, 2018, after IBM, in the … more

Photo: Mary Altaffer, AP

Red Hat soar on IBM deal
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NEW YORK (AP) — Shares of Red Hat skyrocketed at the opening bell Monday after IBM, in the biggest acquisition of its 100-year history, acquired the software company.

The $34 billion stock deal translates to $190 per Red Hat share — a 63 percent premium to the closing price Friday for the Raleigh, North Carolina company. Red Hat Inc.’s stock soared almost 50 percent in early trading.

The path for revitalization for New York’s IBM may be found in cloud technology, a driving force behind the blockbuster deal for Red Hat over the weekend.

“This is about resetting the cloud landscape,” Chairman and CEO Virginia Rometty said Monday in a conference call.

The hybrid cloud — when companies use a mix of on-site, private and third-party public cloud services — is an emerging $1 trillion opportunity that the companies want to be prepared for, Rometty said.

The deal requires the approval of Red Hat shareholders as well as U.S. regulators. It is targeted to close in the latter half of 2019, but there is a good chance that others may wish to make a counterbid.

That prospect sent shares up 47 percent in early trading, close to an all-time high.

“We have long-stated that Red Hat is a strategic asset and while we are not aware of any merger and acquisition discussions or negotiations, we would not be surprised if a hyperscale cloud vendor such as Google, Amazon, Microsoft, or Oracle make a competing bid given Red Hat’s strategic position within on-premise datacenters (over 100K customers),” wrote Stifel’s Brad Reback.

IBM’s stock slipped more than 1 percent Monday.


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Filed Under: Business Virginia Rometty, Ginni Rometty BUSINESS_LEADER PERSON, Brad Reback, New York State, NEW YORK, U.S., Raleigh, North Carolina, Red Hat, IBM, AP, Stifel, MC Complete - State & National, APFN, Google, Amazon, Microsoft, Oracle, red hat amphitheater, red hat jobs, red hat ladies, red hat linux commands, red hat linux download, red hat on the river, red hat software defined storage, red hat documentation, high availability red hat, yum red hat, red hat resellers, red hat forum, red hat summit 2018, red hat hacker, red hat login, red hat resilient storage, red hat releases, why red hat, red hat versions, red hat logo, red hat ibm, red hat antivirus, red hat satellite servers, red hat north carolina, ibm deal, ibm deals, red hat php version, red hat india, ibm red hat

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