IBM closes $6.4B HashiCorp acquisition | TechCrunch

IBM has finalized its multi-billion dollar HashiCorp acquisition, two days after the U.K.’s antitrust regulator gave the deal its blessing.

An IBM spokesperson confirmed to TechCrunch that the U.S. Federal Trade Commission (FTC) had also quietly greenlighted the acquisition just prior to the U.K.’s Competition and Markets Authority (CMA) on Tuesday.

Today’s announcement comes 10 months after IBM first revealed plans to pay $6.4 billion for HashiCorp, an enterprise software company best known for Terraform, an “infrastructure-as-code” tool for automating infrastructure provisioning and management across clouds.

Terraform was once available under an open source license, but HashiCorp controversially switched it to a proprietary license back in 2023 (which led to a community-driven fork called OpenTofu). This license change likely made HashiCorp a more appealing acquisition prospect, giving suitors more control over how Terraform is used in industry.

At any rate, Terraform’s ability to help companies provision their infrastructure (i.e. configure the various hardware, software, and network components required to run applications and services) on-premises and across clouds, fits well with an IBM strategy that has evolved from on-prem systems to the cloud — a strategy that seems to be paying off.

Big Blue flies high

IBM is one of several legacy software companies riding the AI and cloud computing wave, with “Big Blue” hitting an all-time high valuation of more than $240 billion this year. And with HashiCorp now under its wing, this will go some way toward further bolstering its hybrid cloud credentials.

“Organizations globally are looking to deploy modern, hybrid cloud-ready apps, which require automated cloud infrastructure at significant scale,” IBM executive Rob Thomas said in a statement. “With this acquisition, IBM is committed to continuing to invest in and grow the HashiCorp capabilities, and together, with HashiCorp’s leading technology and extensive developer community, IBM’s global reach and R&D resources, our aim is to infuse HashiCorp technology in every data center.”

The acquisition also builds on other sizeable deals in recent times, including IBM’s $34 billion Red Hat purchase in 2019, as well as the $4.6 billion it paid for Apptio in 2023. And on Tuesday this week, IBM announced plans to acquire Apache Cassandra vendor DataStax for an undisclosed figure.

IBM had initially indicated that it expected to close the HashiCorp transaction by the end of 2024, but regulatory red-tape had held things up. A filing with the U.S. Securities and Exchange Commission (SEC) last July revealed that the FTC was reviewing details of the planned merger, while the U.K.’s CMA followed suit in December.

With both the FTC and CMA out the way, this paved the way for IBM to conclude the deal within a couple of days.