IBM buys open-source cloud software developer Red Hat in $34 billion deal

Looking to accelerate its footprint in the burgeoning cloud market, IBM bought leading open source provider Red Hat for $34 billion, the companies announced Sunday.

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In the deal, IBM purchased all outstanding shares of Red Hat for $190 each.

"The acquisition of Red Hat is a game-changer. It changes everything about the cloud market," Ginni Rometty, IBM chairman, president and chief executive officer, said in a release. "This is the next chapter of the cloud. It requires shifting business applications to hybrid cloud, extracting more data and optimizing every part of the business, from supply chains to sales."

The software company will fold into part of IBM's Hybrid Cloud Division, CNBC reported. IBM is focused on its growth in cloud as well as social, mobile and analytics.

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