12:57 - 10.07.2019

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July 10, Fineko/abc.az. World’s large provider of computer services International Business Machines Corp. (IBM) has completed the purchase of software developer Red Hat.

On Tuesday, July 9, IBM announced the closing of the deal on the acquisition of Red Hat for $34 billion. Due to the largest purchase in its history, IBM will be able to strengthen the cloud business by focusing on hybrid solutions.

The merger of IBM and Red Hat was announced at the end of October 2018. The two companies entered into an agreement under which IBM paid from its own funds by $190 for each share of Red Hat that is by 60% more than the rate of quotations the day before the historical announcement.

IBM reports that CEO Jim Whitehurst will continue heading at Red Hat, but will now report to IBM’s CEO Ginny Rometti. The Red Hat’s headquarters will remain in the city of Raleigh (the administrative center of North Carolina).

After the acquisition of Red Hat, about a quarter of IBM's revenue will account for the cloud business against just 4% in 2013.

Red Hat’s earnings by the end of the financial year, which ended in February, increased by 15% up to $3.4 billion. For Mar-Apr it also increased by 15% up to $934 million.

IBM's capitalization has decreased by 3.9% over the past 12 months, but since the beginning of this year it has jumped by 22.6% and is now about $124.6 billion.

According to Red Hat’s forecasts, the operating system Red Hat Enterprise Linux will contribute to receipt of over $10 trillion of total earnings by various companies around the world in 2019. It is expected that 640,000 new jobs associated with Red Hat technologies will appear throughout the world by 2023.

IBM noted that Red Hat will continue to "build and expand its partnership, including with such major cloud service providers as Amazon Web Services, Microsoft Azure, Google Cloud and Alibaba".