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IBM acquires Red Hat

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Re: IBM acquires Red Hat

#71

Post by achamayou »

cmurf wrote: post #58
pinewurst wrote: post #3

Hoping this is false! IBM is the worst of acquirers and they treat their people like utter garbage, especially the more experienced ones. If there's any truth to this, it means those in charge have basically given up - assuming growth is capped and/or that the big return of a buyout premium would counter recent stock pricing setbacks. (Update: now officially announced!)

"those in charge have basically given up" Yes but which company's leadership has given up? If this is the ordinary acquisition model, where the buying company (IBM) leadership stays in charge, then I say it's Red Hat's leadership that's given up. If it's the 'buy a company to get an entirely new leadership team' then it means those in charge of IBM might actually understand their dire situation. But I have no idea if…

Unless the leadership happens to hold quite a lot of shares, their stance isn’t going to matter too much.

Re: IBM acquires Red Hat

#73

Post by pinewurst »

pinewurst wrote: post #3

Hoping this is false! IBM is the worst of acquirers and they treat their people like utter garbage, especially the more experienced ones. If there's any truth to this, it means those in charge have basically given up - assuming growth is capped and/or that the big return of a buyout premium would counter recent stock pricing setbacks. (Update: now officially announced!)

Now official! It's at $190/share vs Friday's $116.68 close

https://www.redhat.com

Re: IBM acquires Red Hat

#74

Post by sz4kerto »

Aloha wrote: post #59

IBM has been very open source friendly over the last 20 years, more so as of recently.

Many companies are OSS friendly, but I think being OSS friendly is different than building your whole organization on OSS. RH does the latter, many-many companies are the former.

Re: IBM acquires Red Hat

#75

Post by adventured »

wereHamster wrote: post #4

Is this event comparable to when Oracle bought Sun? Should we expect IBM to rip RH apart and alienate all existing customers?

The alienate and destroy part is likely. Very different situations otherwise.

Sun was essentially a dead shell that still held a few valuable pieces when Oracle purchased them. Overall the business was in terminal decline.

Red Hat, while wildly overvalued (as many things are/were in this bubble market), has a consistently growing business that is on good footing overall.

Their prior four fiscal year sales figures: $1.7b, $2b, $2.4b, $2.9b

They look like they could do $3.4b in sales for fiscal 2019.

Their profitability is mildly lacking and combined with their modest growth doesn't come close to supporting their extreme valuation (much less when the stock was 50% higher). It's not surprising the board might sell the company here, the stock market bubble is likely nearing an end, with interest rates rising or a recession coming up next (either of which guarantee it's over). Red Hat may not see much higher than this market cap for another decade - assuming continued modest growth - if they were valued at a more sane level.

Red Hat is riding relatively high. Sun was on its last legs as an independent entity. Red Hat very clearly does not need to sell here, if they do it's simply the board taking what is an extraordinary price (would have to guess the deal will value them at 60 to 80 times idealized 2018 earnings).

Re: IBM acquires Red Hat

#76

Post by underpand »

pinewurst wrote: post #73
pinewurst wrote: post #3

Hoping this is false! IBM is the worst of acquirers and they treat their people like utter garbage, especially the more experienced ones. If there's any truth to this, it means those in charge have basically given up - assuming growth is capped and/or that the big return of a buyout premium would counter recent stock pricing setbacks. (Update: now officially announced!)

Now official! It's at $190/share vs Friday's $116.68 close https://www.redhat.com

Oh no

Re: IBM acquires Red Hat

#77

Post by Juliate »

achamayou wrote: post #71
cmurf wrote: post #58

Earlier quoted context omitted.

"those in charge have basically given up" Yes but which company's leadership has given up? If this is the ordinary acquisition model, where the buying company (IBM) leadership stays in charge, then I say it's Red Hat's leadership that's given up. If it's the 'buy a company to get an entirely new leadership team' then it means those in charge of IBM might actually understand their dire situation. But I have no idea if…

Unless the leadership happens to hold quite a lot of shares, their stance isn’t going to matter too much.

Your don't buy/hire a leadership team to tell them what to do (unless you happen to like to waste time and money).

This happened at Apple (NeXT took over). Somehow with Disney/Pixar too if I'm not mistaken.

Re: IBM acquires Red Hat

#79

Post by anothergoogler »

sz4kerto wrote: post #52

Guys, this is not just, or mainly not RH Linux. :( - kernel development - Ansible - JBoss (I know HN hates Java, especially Java EE, but it was and is an important factor in enterprise OSS adoption) - OpenShift - Ceph, Gluster All these are in danger, not just RHEL. I don't know about any other company that is large, successful, focuses on the enterprise and absolutely behind OSS. Canonical is way behind Red Hat in t…

It goes much deeper than that, Red Hat maintains or contributes regularly to a wide swath of the Linux ecosystem. They also have a policy of open sourcing acquisitions. If the deal goes through, it's a dark day for open source software.

Re: IBM acquires Red Hat

#80

Post by technofiend »

Well, fuck. I spent the last couple of years completely revamping my UNIX support group. I got rid of all the weak SAs and used a mix of in person and online vendor training plus internal challenges to elevate everyone's skills. We were able to completely repurpose the "Level 3" UNIX engineering group because all the "Level 2" guys no longer needed to escalate to Level 3 for anything.

Critical to that was buying RedHat Learning Subscription and pushing my top guys through RedHat's Certified Architect program. But I'm skeptical but we'd have the same leverage to obtain similar learning discounts from IBM.

Honestly as my org gets more comfortable with pure open source solutions it may be time to just consider Fedora instead, particularly as our workloads are moving from bare metal to VMs to containers it arguably means less and less where the app is hosted anyway.

In the end it may mean RHEL going the way of Solaris as ever dearer license fees combined with a drop in support quality undermines their value proposition.

But I guess that's a problem for the next guy; my org transformation is done so I took a job doing provisioning using Terraform.

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