Red Hat to acquire Web services software maker

The Linux developer agrees to buy closely held Bluecurve for about $37.7 million in stock.

Durham, N.C.--Linux developer Red Hat has agreed to buy closely held software maker Bluecurve for about $37.7 million in stock.

Red Hat will issue as many as 1.26 million common shares for Oakland, Calif.-based Bluecurve. The transaction will be valued based on the average closing price of Red Hat shares for a five-day period ending Monday.

The company will use Bluecurve's performance-management software to create a Web-based service that helps companies build and manage Internet systems.

Chief financial officer Hal Covert said the transaction won't affect fiscal year 2001 earnings or revenue. The purchase, which will help expand Red Hat's subscription-based services, is expected to begin adding to revenue in fiscal 2002, he said.

Shares of Red Hat fell $1.50 to $28 on the Nasdaq Stock Market. They've quadrupled since the company went public in August.

Copyright 2000, Bloomberg L.P. All Rights Reserved.

Autoplay: ON Autoplay: OFF