Form 8-K RED HAT INC For: Oct 16

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): October 16, 2015

 

 

Red Hat, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

 

Delaware

(State or Other Jurisdiction of Incorporation)

 

001-33162		06-1364380
(Commission File Number)		(IRS Employer Identification No.)
100 East Davie Street, Raleigh, North Carolina		27601
(Address of Principal Executive Offices)		(Zip Code)

(919) 754-3700

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 7.01.

Regulation FD Disclosure.

On October 16, 2015, Red Hat, Inc., a Delaware corporation (“Red Hat”), Ansible, Inc., a Delaware corporation (“Ansible”), Spider Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of Red Hat (“Spider”), and Fortis Advisors LLC, as holder agent, entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which, upon the satisfaction or waiver of the conditions in the Merger Agreement, Red Hat will acquire Ansible through a merger of Spider with and into Ansible (the “Merger”). The closing of the Merger is conditioned upon customary closing conditions, including approval by the stockholders of Ansible. A press release announcing this acquisition as well as updated guidance for the third quarter and full year of Red Hat’s fiscal year ending February 29, 2016 was issued on October 16, 2015 and is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K.

The information in Item 7.01 of this Current Report on Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

 

Item 9.01.

Financial Statements and Exhibits

(d) Exhibits

See Exhibit Index attached hereto.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: October 16, 2015		RED HAT, INC.
		By:		/s/ Frank A. Calderoni
		Name:		Frank A. Calderoni
		Title:		Executive Vice President, Operations and Chief Financial Officer

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EXHIBIT INDEX

 

Exhibit No.		Description
99.1		Press Release dated October 16, 2015

Exhibit 99.1

Media Contact:

Stephanie Wonderlick

Red Hat, Inc.

+1-571-421-8169

[email protected]

Investor Relations:

Tom McCallum

Red Hat, Inc.

+1-919-754-4630

[email protected]

Red Hat to Acquire IT Automation and DevOps Leader Ansible

Red Hat advances frictionless IT with simplified management for hybrid clouds, OpenStack

environments and container-based services

RALEIGH, N.C. – OCT. 16, 2015 – Red Hat, Inc. (NYSE: RHT), the world’s leading provider of open source solutions, today announced that it has signed a definitive agreement to acquire Ansible, Inc., a provider of powerful IT automation solutions designed to help enterprises move toward frictionless IT. Ansible’s automation capabilities, together with Red Hat’s existing management portfolio, will help users drive down the cost and complexity of deploying and managing both cloud-native and traditional applications across hybrid cloud environments. With today’s announcement, Red Hat expands its leadership in hybrid cloud management, OpenStack and containers.

Ansible’s simple and agentless approach, unlike competing solutions, does not require any special coding skills, removing some of the most significant barriers to automation across IT. From deployment and configuration to rolling upgrades, by adding Ansible to its hybrid management portfolio, Red Hat will help customers to:

 

●

Deploy and manage applications across private and public clouds.

●

Speed service delivery through DevOps initiatives.

●

Streamline OpenStack installations and upgrades.

●

Accelerate container adoption by simplifying orchestration and configuration.

The upstream Ansible project is one of the most popular open source automation projects on GitHub with an active and highly engaged community, encompassing nearly 1,200 contributors. Ansible automation is being used by a growing number of Fortune 100 companies, powering large and complex private cloud environments, and the company has received several notable accolades, including a 2015 InfoWorld Bossie Award, recognizing the best open source datacenter and cloud software.

With the addition of Ansible, Red Hat’s open hybrid cloud and IT management solutions will include:

 

●

Red Hat CloudForms, an open management platform that provides orchestration, governance and policy-based control across hybrid clouds enabling self-service provisioning, and resource management as well as quota enforcement, metering and chargeback.

●

Red Hat Satellite, a comprehensive lifecycle management solution with integrated infrastructure provisioning, software distribution, patch management and auditing capabilities.

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●

Ansible and Ansible Tower, an IT automation and DevOps platform that provides significantly simplified multi-tier application deployment and IT automation across hybrid clouds.

The acquisition is expected to have no material impact to Red Hat’s revenue for the third and fourth quarters of its fiscal year ending Feb. 29, 2016 (“fiscal 2016”). Management expects that non-GAAP operating expenses for fiscal 2016 will increase by approximately $2.0 million, or ($0.01) per share, in the third quarter and approximately $4.0 million, or ($0.02) per share, in the fourth quarter as a result of the transaction. Red Hat calculates non-GAAP operating expense by subtracting from GAAP operating expense the estimated impact of non-cash share-based compensation expense, which for fiscal 2016 is expected to increase by approximately $1 million for each of the third and fourth quarters, and amortization of intangible assets, which for fiscal 2016 is expected to increase by approximately $1 million for each of the third and fourth quarters, in addition to transaction costs related to business combinations, which are expected to increase by approximately $1 million in the third quarter. Management expects GAAP operating expense to increase for fiscal 2016 by approximately $5 million, or ($0.02) per share, in the third quarter and approximately $6 million, or ($0.02) per share, in the fourth quarter as a result of the transaction. Excluding the operating expense impact as noted above to GAAP and non-GAAP operating margin and GAAP and non-GAAP earnings per share, Red Hat is otherwise re-affirming its fiscal 2016 third quarter and full year guidance provided in its Sept. 21, 2015, earnings press release.

The transaction is expected to close in October 2015, subject to customary closing conditions.

Webcast

Executives from both companies will host a webcast to discuss this announcement on Thursday, Oct. 22, 2015, at 11 a.m. EDT. Following executive remarks, press and analysts are invited to participate in a live question and answer session.

To join the webcast or view the replay after the event, visit

https://vts.inxpo.com/Launch/QReg.htm?ShowKey=27948.

Read more about the acquisition on Red Hat’s website including in the Red Hat blog.

Supporting Quotes

Saïd Ziouani, co-founder and CEO, Ansible

“We’re thrilled that Red Hat, a global leader in open source, has chosen Ansible to tackle the future of IT automation and systems management. This is a strong validation that Ansible’s simplicity, enterprise customer base and robust community is winning in enterprise IT automation, from compute to networking to cloud to containers.”

Joe Fitzgerald, vice president, Management, Red Hat

“Ansible is a clear leader in IT automation and DevOps, and helps Red Hat take a significant step forward in our goal of creating frictionless IT. Red Hat is transforming IT management, driving innovation that is 100% open source, built on an open management platform, and relentlessly focused on reducing cost and complexity through ease of use and automation. I am thrilled to welcome Ansible to Red Hat to help us expand that commitment.”

Doug Carlisle, managing director, Menlo Ventures

“I commend the entire Ansible team for their execution over the past two years and congratulate Red Hat for their leadership in cloud and recognition of the growing importance of DevOps via this acquisition. I believe the addition of Ansible to its cloud management portfolio will help to place Red Hat at the forefront of cloud and DevOps.”

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Worldwide Cloud Systems Management Software Forecast Update, 2015–2019—July 2015, IDC #257928

“According to IDC’s worldwide analysis as of July 2015, the worldwide cloud systems management software market achieved total revenue of $2.3 billion in 2014, representing growth of 29.9% from 2013. The market is currently forecast to grow to $8.3 billion in 2019 at a compound annual growth rate (CAGR) of 28.9% for the 2014–2019 period.”

About Red Hat, Inc.

Red Hat is the world’s leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training, and consulting services. As a connective hub in a global network of enterprises, partners, and open source communities, Red Hat helps create relevant, innovative technologies that liberate resources for growth and prepare customers for the future of IT. Learn more at http://www.redhat.com.

Forward-Looking Statements

Certain statements contained in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: risks related to the integration of acquisitions and the ability to market successfully acquired technologies and products; the ability of the Company to compete effectively; the ability to deliver and stimulate demand for new products and technological innovations on a timely basis; the effects of industry consolidation; delays or reductions in information technology spending; uncertainty and adverse results in litigation and related settlements; the inability to adequately protect Company intellectual property and the potential for infringement or breach of license claims of or relating to third party intellectual property; risks related to data and information security vulnerabilities; ineffective management of, and control over, the Company’s growth and international operations; fluctuations in exchange rates; and changes in and a dependence on key personnel, as well as other factors contained in our most recent Quarterly Report on Form 10-Q (copies of which may be accessed through the Securities and Exchange Commission’s website at http://www.sec.gov), including those found therein under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. In addition to these factors, actual future performance, outcomes, and results may differ materially because of more general factors including (without limitation) general industry and market conditions and growth rates, economic and political conditions, governmental and public policy changes and the impact of natural disasters such as earthquakes and floods. The forward-looking statements included in this press release represent the Company’s views as of the date of this press release and these views could change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

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Red Hat and the Shadowman logo are trademarks of Red Hat, Inc., registered in the U.S. and

other countries. Linux^® is the registered trademark of Linus Torvalds in the U.S. and other

countries. The OpenStack mark is either a registered trademark/service mark or

trademark/service mark of the OpenStack Foundation, in the United States and other countries,

and is used with the OpenStack Foundation’s permission. We are not affiliated with, endorsed

or sponsored by the OpenStack Foundation, or the OpenStack community.

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