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Red Hat buys JBoss

Start-up sold for cash

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Linux distributor Red Hat has bought open source middleware firm JBoss for $350m.

The price includes $70m which is subject to performance targets. Sixty per cent of the price will be paid in Red Hat shares and the rest in cash.

The press release says JBoss has modelled its business on Red Hat's subscription model as well as sharing its committment to open source software. JBoss has been at the centre of rumours of an imminent sale for some months. Oracle was one rumoured suitor.

JBoss CEO Marc Fleury said: "By joining forces with Red Hat, we expect to be able to provide enterprises with the largest offering of open source solutions, a global services network staffed by technology experts, and a large and vibrant eco-system of certified products and services."

The takeover is subject to the usual conditions, but is expected to close in the first fiscal quarter ending May 2006. It should have no effect on Red Hat's earnings and cash flow for the year.

Red Hat believes the deal will accelerate the move towards service-oriented architecture.

Visit Red Hat for the whole press release here. ®

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