Comment by liveoneggs
7 years ago
redhat was trading at around $120 last week and IBM announced "Red Hat for $190.00 per share in cash, representing a total enterprise value of approximately $34 billion."
That $120 was really high for redhat, who just crossed the $100/share price last year. (unless you count year 2000/dotcom-IPO-madness) RHT's market cap was previously $20B.
Note that IBM is buying every last Redhat share here, so of course it has to pay more than the price for "just one more" share.
That's not weird. It's a bit much as these things go, but 20-30% over the share price would not raise any eyebrows.
yeah it's not raising my eyebrows but I was trying to give the data to explain why an established and somewhat profitable company (like redhat) would sell to a player like IBM. It's just a lot of money to turn down!