Red Hat said Monday it will pay $350 million for JBoss with another $70 million to be paid with the completion of certain performance milestones.

W. David Gardner, Contributor

April 10, 2006

1 Min Read

Red Hat said Monday it will acquire open source middleware provider JBoss for as much as $420 million, in a move that will enable Red Hat to accelerate its drive into service-oriented architectures (SOA.)

Closely-held JBoss had been the subject of recent reports of private bidding contests to acquire the firm. In a February report, JBoss said it had recorded triple digit revenue growth in the past year.

Red Hat said it will pay $350 million -- 40 percent in cash and 60 percent in stock -- for JBoss with another $70 million to be paid with the completion of certain future performance milestones. Red Hat's sales grew 42 percent in its most recent fiscal year.

In a statement, the acquiring firm said: "Red Hat believes the combination, once consummated, will help accelerate the shift to SOA by making innovative, powerful solutions available to developers and customers that seek to lower development and deployment costs."

JBoss itself have been acquiring firms with SOA capability. It recently acquired J2EE and Web services transaction technology from Hewlett-Packard and Arjuna Technologies. JBoss said its strategy was to provide enterprise middleware including products built to be used alone, or mixed and matched or as a whole.

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