IBM Announces Its Acquisition of Red Hat

IBM announced in October 2018 that it would acquire Red Hat for about $34 billion, one of the largest software acquisitions ever at the time. Red Hat’s most important asset was not merely its Linux distribution but its position in enterprise open-source infrastructure.

Red Hat Enterprise Linux provided a supported operating-system base, while OpenShift built a platform around containers and Kubernetes. IBM saw those technologies as a route into hybrid cloud, where companies operate applications across their own data centers and several public clouds.

The acquisition reflected a shift in enterprise computing. Customers increasingly wanted a consistent software layer that was portable across infrastructure providers. Open-source Linux and Kubernetes offered that layer more naturally than proprietary server stacks tied to one vendor.