IBM’s 2018 acquisition of Red Hat strengthened its position in enterprise cloud computing.
IBM announced its agreement to acquire Red Hat in October 2018 and completed the transaction in July 2019. The deal was valued at approximately $34 billion, making it one of IBM’s largest acquisitions and a major step in its hybrid-cloud strategy.
Red Hat was best known for enterprise open-source software, especially Red Hat Enterprise Linux and its OpenShift platform. IBM intended to combine those technologies with its consulting, infrastructure, and software businesses so organizations could run applications across private data centers and public clouds.
The deal is relevant to market-cap comparisons because IBM is an established technology company whose valuation is tied heavily to enterprise contracts and recurring services. It also illustrates why companies valued by investors are not ranked only by consumer visibility: business software and infrastructure can support very large public corporations.