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Red Hat, not Oracle, buys JBossDennis Callaghan, April 10, 2006 @ 9:19 am ET
When I talked to Shaun Connolly, JBoss’s vp of product development a few weeks ago, he danced around the Oracle-JBoss acquisition rumors, suggesting that JBoss was on the IPO track and any company that did want to acquire it would have to respect its business model. Apparently, one company that would respect JBoss’ business model is Red Hat, which pretty much inspired the JBoss business model. The companies announced earlier this morning that Red Hat was buying JBoss in a mixed cash-and-stock deal, worth $350m initially with the potential to add an additional $70m to the deal based on performance.
Red Hat and JBoss call the deal a “complete fit”–business model, channels, service delivery and culture. Red Hat, best known for its Linux servers and related management technologies, gains entry into the middleware space, which the company, by all appearances had made little headway in to date. Red Hat had offered an open source Java application server based on ObjectWeb’s JOnAS technology but had done little to actively market or develop the technology beyond the initial release in August 2004. JBoss, beset by competition from heavyweights like IBM, BEA Systems and Oracle, as well as open-source upstarts like LogicBlaze, gets a larger corporate backer and access to its sales channels. A win-win? Well maybe not. Open source is so much more than Linux today and now one of the companies at the forefront of today’s open source movement gets swallowed up by an old-line Linux vendor.
We’ll have more indepth coverage and analysis of this deal in our Market Insight and TechDealmaker services.
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