IBM Announces Its Intent to Acquire Red Hat for $34

IBM is set to aquire Red Hat for $34B. WWT and Red Hat will continue to provide innovative cloud solutions in our Advanced Technology Center.

October 27, 2018 3 minute read

IBM stunned the technology world by announcing its intent to acquire Red Hat.

On October 28, 2018, IBM announced its proposed purchase price of Red Hat for $34 billion, a 63 percent premium on Red Hat’s closing price on Friday, October 25, making this the most expensive software acquisition in US history. In comments last week, IBM and Red Hat leadership announced that Red Hat would operate as an independent entity within IBM with Red Hat’s CEO Jim Whitehurst reporting directly to IBM CEO Ginni Rometty. This operating model is similar to the successful model EMC created for VMware after EMC acquired VMware in 2004. With this operating model in place, Red Hat will continue to be free to use its unique open-source innovation engine to accelerate value to its customers.

While Red Hat continues to execute on its existing strategy, IBM plans to use Red Hat technology, such as OpenShift Container Platform (OCP), to strengthen IBM’s cloud offerings. Specifically, IBM plans to focus on hybrid cloud which enables customers to seamlessly connect on-premise and public cloud environments. Given IBM’s relationships in the enterprise customer base, this makes sense strategically as it will enable IBM to help its existing customers take advantage of the unique capabilities of the public cloud.

WWT looks forward to our continued partnership with Red Hat and to the increased value it brings to our joint customers. Specifically, WWT and Red Hat will continue our joint investments in:

  • Infrastructure automation with Ansible Tower
  • Network Function Virtualization (NFV) with OpenStack Platform (OSP)
  • Container infrastructure and DevOps with OpenShift Container Platform (OCP) for Multicloud Architectures
  • Bare metal provisioning with CloudForms
  • Professional Services

WWT’s unique assets, including our Advanced Technology Center (ATC) and our three Global Integration Centers located in St. Louis, Singapore and Amsterdam, enable customers to validate and integrate Red Hat technology into customer solutions with speed and at scale. Each of Red Hat’s software offerings are deployed within our ATC which provides customers with preconfigured demonstrations, sandboxes and proofs of concept (POCs). Our Global Integration Centers take validated solutions from the ATC and build them into fully integrated racks for deployment within our customers’ environments. In addition, our agile software development teams provide customers with consulting services related to DevOps processes and tools and agile software development services enabling customers to get the most value out of their cloud-native platforms.

As the industry goes through these types of transitions, presenting an ever-changing set of technology options, WWT is ready to support our customers as they strive to achieve their intended business outcomes.

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