EU Regulators to Decide on IBM-Red Hat Deal by June 27

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The deal, which would be IBM’s biggest, is intended to help the company expand its footprint into subscription-based software.

 European Union regulators will decide on whether to approve the proposed $34 billion acquisition of Red Hat by IBM by June 27, according to reports.

As reported by Reuters, IBM filed for EU approval on Monday and the European Commission confirmed the request.

The EU competition enforcer can either clear the deal with or without conditions or it can open a full-scale investigation, Reuters added.

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The deal, which would be IBM’s biggest, is intended to help the company expand its footprint into subscription-based software.

The US Department of Justice approved the deal without demanding concessions earlier this month.

Red Hat will join IBM’s Hybrid Cloud team as a distinct unit

The deal is anticipated to close in the second half of 2019. Once the deal is closed, Red Hat will join IBM’s Hybrid Cloud team as a distinct unit, and will maintain its current management team and headquarters, facilities, brands and practices.

Red Hat shareholders would also receive $190 a share in cash if the deal is approved.

Earlier this month, IBM CEO Ginni Rometty had made it clear that IBM will let RedHat work independently. “RedHat will stay independent. I want them to be successful,” she said while interacting with RedHat CEO Jim Whitehurst at the RedHat Summit.

 

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