Why Did IBM Court the Playful “Red Hats”?

Red Hats society

 

In November when I read International Business Machines (IBM) were courting Red Hat for a boatload $34 Billing, I thought “Oh boy, the ‘Red Hat’ Moms hit the jackpot!”

The Red Hat Society is a fun-loving group of women decked out in red hats (not baseball caps; hats worthy of Kentucky Derby status. A playful group to empower each other to pursue their passions.

IBM’s pursuit should have been for the pizzazz  of the Society, but they approved U.S. and RHT shareholder approval for this world leading provider of open-cloud solutions and the emerging leader in the platform for hybrid-cloud and multi-cloud. The European Union bid decision is slated for June 27, 2019.

I struggle to understand what IBM gets with Red Hat, that it did not already have, to justify $34 Billion. At the same time, IBM will now be the undisputed leader in hybrid-cloud.

I’m also skeptical the the Red Hat acquisition is going to be meaningful over the long term for IBM. The argument that the marriage is more than the individual parts is not a strong one in my view. But it will take some time for the market to see how IBM digests RHT.

November, 2018, IBM share price was $120. Today, ________it’s $________. If you’re a Bullish Mom and think IBM will go up, try the $___strike price, Debit Call Spread.

On the other hand, Mom, if you think IBM is bearish and will go down, try the $____ strike price, Debit Put Spread.

P.S.
Need a little coaching on how to make this option trade?
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Marquee sign: “See you next Wednesday for “name of blog”(insert my picture, real little) Barb
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Let's keep in touch, Barb

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