NEW YORK: International Business Machines Corp said on Tuesday it has closed its $34 billion acquisition of software company Red Hat Inc as it looks to ramp up its cloud computing business.
Underscoring the drive into high-margin businesses, IBM in October agreed to buy Red Hat, the company’s biggest acquisition in its more than 100-year history.
Ginni Rometty, IBM chief executive since 2012, has steered the company toward faster-growing segments such as cloud, software and services and away from traditional hardware products, but not without a bumpy journey. The newer areas of focus have sometimes underwhelmed investors.
The company, which won approval for the purchase from EU regulators in late June and US regulators in May, agreed to pay $190 a share for Red Hat, representing a 63 percent premium.
Founded in 1993, Red Hat specializes in Linux operating systems, the most popular type of open-source software and an alternative to proprietary software made by Microsoft Corp. IBM has faced years of revenue declines as it transitions from its legacy computer hardware business into new technology products and services.
— Reuters
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