Computer manufacturer IBM (IBM) announced in late October that it would acquire open source software and cloud services firm Red Hat for $34 billion. Per the terms of the acquisition, Red Hat will retain a degree of autonomy as a separate business unit within the larger IBM umbrella. This means that Red Hat’s partnerships and existing open source projects are likely to continue for the foreseeable future. In this sense, the acquisition can be seen as a win-win for both companies: Red Hat received a substantial sum of money and access to scaling without having to give up its unique approach, goals, team, and culture, while IBM notched an impressive feather in its cap and continued its expansion into the cloud.

This is not the first time that IBM has acquired a company. Below, we’ll take a look at some of the other companies the computer maker has purchased.

Transarc Corporation

In 1994, IBM purchased Pennsylvania-based software outfit Transarc Corporation, a five-year-old company which had popularized multiple file system software. Among other products, Transarc developed a distributed transaction processing monitor called Encina; IBM utilized this product to develop its own UNIX-based products later on.

Lotus Software

The maker of the popular Lotus 1-2-3 spreadsheet application, one of the first user-friendly and accessible applications in the earliest days of IBM personal computers, Lotus Software was purchased by IBM in 1995 for the price of $3.5 billion. A major impetus for the acquisition was Lotus Notes, a popular application Lotus had developed prior to the purchase. IBM also bought the company as a means of accessing the client-server computing world, which threatened to make host-based software a thing of the past.

Rational Machines

In 2003, IBM bought and rebranded Rational Machines for the price of $2.1 billion. Rational provided an integrated development environment designed to enhance productivity in development team settings. IBM chose to purchase the company after the dot-com bubble burst and when Rational had declined in value (although the company was still highly profitable at the time).


IBM investors and customers will likely have encountered the company’s line of business intelligence and performance management tools branded as Cognos products. The name of these products is tied to a company of the same name that the computer maker acquired in 2007 for $4.9 billion. The deal was seen as a major step toward IBM becoming a top-level competitor of companies like Microsoft, with an extensive range of both hardware and software products.


One of IBM’s most recent acquisitions is Cleversafe. IBM purchased Cleversafe on November 6, 2015. The company developed an object storage system which was originally called Dispersed Storage Network but which has been rebranded post-acquisition as the IBM Cloud Object Storage service. This acquisition was another important step in IBM’s movement toward cloud services.


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