Tech: Here's who will get richer when IBM buys Red Hat for $34 billion (IBM, RHT)

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Jim Whitehurst

IBM announced on Sunday it would acquire the software company Red Hat for $190 per share, at a total around $34 billion. Here's how much money Red Hat's top shareholders and executives could make on the deal.

  • IBM announced on Sunday it would acquire the open source software company Red Hat for $190 per share, for a total deal value of about $34 billion.
  • The acquisition stands to be a significant payday for Red Hat's top executives and shareholders.
  • Red Hat President Jim Whitehurst could make over $72 million from the deal.
  • Red Hat's top insitutional shareholder, Vangaurd Group, holds Red Hat stock now valued in the deal at $3.5 billion.

On Sunday, IBM announced it intends to acquire the open source software company Red Hat for around $34 billion, or $190 per share.

"The acquisition of Red Hat is a game-changer. It changes everything about the cloud market," said Ginni Rometty, IBM chairman and CEO.

The deal will also be a significant payday for Red Hat's top executives and shareholders. The deal hasn't closed, which means that the terms could theoretically still change. However, using the $190 per share price as a guideline, some simple napkin math shows us who could walk away from the deal richer.

Jim Whitehurst, who's served as President of Red Hat since 2008, holds stock valued at $72,590,830 based on the 382,057 shares in the company he held as of a June 2018 SEC filing.

Paul Cormier, Red Hat's executive VP of engineering, is in second place, with stock holdings valued in the deal at $34 million. Cormier is followed by Arun Oberoi, EVP of global sales and services, at $23 million, director William Kaiser at $13 million, and general counsel Michael Cunningham at just over $10 million.

Red Hat's top institutional shareholder is Vanguard Group, which could cash out at $3,534,165,110 on the deal from its 18,600,869 Red Hat shares. In second place is T. Rowe Price Associates at $3.4 billion, followed by FMR LLC at $3.1 billion, Blackrock at $2.3 billion, and Jennison Associates at $1.5 billion.

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