Red Hat has added to its portfolio of ecommerce software by buying a company that supplies credit card processing applications for the Linux operating system.
The Linux distributor said it would acquire all of Hell's Kitchen Systems'(HKS) outstanding shares by issuing up to 398,335 shares of its own common stock.
The news helped boost Red Hat's share price by 19 per cent to close up $41 at $256, on a day that the overall technology market was down. This valued the HKS deal at $102 million.
Robert Young, Red Hat's chairman, said the company's strategy was to be a one stop shop for Linux based software, services and support aimed at any business wanting to start an ecommerce operation.
He added that HKS was building a specific piece of technology, but did not have the brand awareness to take it to a global market.
"Customers want a company like Red Hat to take all that technology and turn it into a solution. They rely on Red Hat to provide them with the updates, the bug fixes, and for that they pay us a support contract," he attested.
HKS, a five person privately held company that was founded in the Hell's Kitchen district of Manhattan, claimed its Credit Card Verification System was used by more than 150 customers worldwide, including Internet Service Providers and online merchants.
Red Hat will integrate the firm's software into the Professional Edition of its operating system packages, which include businesses applications.
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