By John Meyer, consultant in financial affairs – Eurasia Business News, December 30, 2024. Article No 1355.
IBM’s planned acquisition of HashiCorp for $6.4 billion is currently facing scrutiny from the U.K.’s Competition and Markets Authority (CMA). The CMA announced on December 30 that it is evaluating whether the deal could significantly reduce competition in the market.
Interested parties have until January 16, 2025, to submit their comments, with a provisional decision expected by February 25, 2025, on whether to clear the deal or conduct a more detailed investigation.
The UK CMA is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.
The acquisition, which was initially announced in April 2024, involves IBM paying $35 per share for HashiCorp, a company known for its cloud infrastructure tools, including Terraform. This purchase aims to bolster IBM’s capabilities in hybrid cloud and artificial intelligence sectors.
The deal has already received approval from both companies’ boards and is supported by significant shareholders of HashiCorp, who collectively hold about 43% of the voting power.
In addition to U.K. scrutiny, the U.S. Federal Trade Commission (FTC) is also reviewing the acquisition, having requested further information from both companies earlier this year.
As the cloud computing sector faces increased regulatory oversight, the outcome of these investigations will be critical for IBM’s strategic expansion into cloud services and AI technologies.
HashiCorp is an American software company founded in 2012 by Mitchell Hashimoto and Armon Dadgar, headquartered in San Francisco, California. The company specializes in infrastructure automation and management tools designed to facilitate the development and deployment of applications in multi-cloud and hybrid environments. HashiCorp’s mission is to help organizations automate their infrastructure lifecycle and security lifecycle management, enabling faster and more efficient application delivery.
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© Copyright 2024 – Eurasia Business News. Article no. 1355.
