IBM appears to have had fierce competition in the acquisition of Red Hat. The company pays $34 billion for that. But conversations were also held with Amazon, Google and Microsoft. IBM eventually decided to take over the company for this huge amount of money.
The Business Insider site reports this on the basis of sources within the various companies involved. When IBM last October announced the acquisition of 34 billion U.S. dollars, two things stood out. On the one hand there was the high price tag, but on the other hand there was also the potential of Red Hat to help IBM restore its cloud business. The takeover would almost have been different.
Multiple parties
Amazon, Google and Microsoft all had discussions with Red Hat about a possible acquisition. Those talks took place months before IBM made the takeover bid. As an open-source company, Red Hat is a strategically important party, because of its popularity among developers. For example, it is developing Linux and IBM wanted to get a helping hand in strengthening its hybrid cloud.
At the end of November, however, Red Hat reported that three companies had considered bidding on the company, or entering into a partnership. It appears that IBM was already discussing a possible acquisition with Red Hat in April. At that time, the Board asked its advisors to draw up a list of possible other parties.
No one wanted to bid
According to the sources of Business Insider, Microsoft did want to have discussions about the acquisition. However, the company decided in October to stop doing so because it wondered whether it could be allowed to take over the necessary authorities.
Google was interested, but it was mainly interested in a partnership. In the end there was no offer from her side. Finally, Amazon also wanted to talk to Red Hat, but in the end it was unable to take over the company.
Acquisition by IBM
The acquisition by IBM was also not immediately certain. The company initially offered $185 per Red Hat share. That was not enough, according to the board, and after some negotiations IBM came up with 190 dollars per share. The board of directors did approve that offer.
Now it’s up to the shareholders to agree. They will vote on 16 January 2019. If they agree, this is the largest acquisition in IBM’s more than one hundred years of history.
This news article was automatically translated from Dutch to give Techzine.eu a head start. All news articles after September 1, 2019 are written in native English and NOT translated. All our background stories are written in native English as well. For more information read our launch article.
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