IBM buys Red Hat for $34 billion and will work as stand-alone unit within the IBM Hybrid Cloud team

IBM has announced that it will buy Red Hat for $34 billion, which is one of the world’s largest open source companies. It is the largest acquisition ever made by the U.S. multi-company, and the third largest within the United States, at least in terms of technology.

IBM buys Red Hat for billion and will work as stand-alone unit within the IBM Hybrid Cloud team

The joint press release, which was issued mysteriously on Sunday, states that the purchase will help IBM to expand its cloud computing offering to the enterprise market.

Red Hat was the first open source software company to generate more than a billion dollars in revenue in a single quarter. Its Linux version is installed on millions of computers around the world.

The press release makes it clear that Red Hat will retain its independence and act as a stand-alone unit within the IBM Hybrid Cloud team. Jim Whitehurst, the company’s current CEO will remain at the top of the team and join the board, reporting directly to CEO Ginni Rometty.

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In addition, Red Hat will continue to operate from its own offices, and values, practices, and trademarks will be respected.