IBM, one of the largest IT service providers, has completed a deal to purchase a software developer Red Hat. The purchase cost $ 34 billion.
The deal has turned out to be the largest in the history of the company. Moreover, it is considered to be one of the most significant in the entire segment.
Nothing will ever change in Red Hat. Jim Whitehurst is still its CEO; the main office will remain in Raleigh, North Carolina. The company will change only its head. The work of Red Hat will be supervised by IBM CEO Virginia Rometty. From now Red Hat’s authorities have to report to her.
The acquisition of Red Hat will allow IBM to increase its share in the cloud business. About 25% of the total revenue of the company is owed by Red Hat. Previously, this figure was only a few percent.
According to the report for the last fiscal year ended in February, Red Hat’s revenue has increased by 15% to $ 3.4 billion. From March to April, it has grown up another 15% to $ 930 million.
For 12 months, IBM’s market value has decreased by 4%. But since 2018, it has risen by 22.5%. At the moment, the capitalization of the high-tech giant is approximately $ 125 billion.
The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group