Open-source software vendor Red Hat is buying privately held Hell's Kitchen Systems (HKS) in a stock-swap deal that will bring the HKS e-commerce payment processing software into the Red Hat fold.
A dollar value for the transaction will be determined when the deal is finalised, and depends on value of Red Hat shares at that time, Red Hat spokeswoman Melissa London said. The deal should be complete within the next couple of months, she said.
Red Hat will exchange 398,335 shares of common stock to acquire all outstanding shares of HKS. The deal still must be approved by HKS shareholders.
Red Hat shares were selling for about $US220 each on the Nasdaq stock exchange at noon today.
Tiny HKS has five employees, who are expected to stay with Red Hat when the acquisition is complete. The HKS office in Pittsburgh will stay open, but HKS will take the Red Hat name, London said.
Red Hat has become best known for its version of the open-source Linux operating system, but also offers other open-source applications and consulting. HKS was founded in the Hell's Kitchen neighborhood of Manhattan before moving to Pittsburgh in 1997. The company specialises in credit-card processing software for Linux and Unix systems.