Red Hat to buy FuseSource for undisclosed sum

Red Hat to buy FuseSource from Progress Software for undisclosed price

Associated Press

RALEIGH, N.C. (AP) -- Red Hat Inc., which sells the Linux open-source operating system, said Wednesday that it will acquire open-source integration and messaging provider FuseSource from Progress Software Corp.

The company didn't say how much the deal is worth, but it said buying FuseSource will enable it to deliver its application integration products and services faster.

"Application integration software is one of the fastest-growing segments of the enterprise software market," Craig Muzilla, vice president and general manager of middleware at Red Hat, said in a statement.

Muzilla said the growing popularity of cloud computing means businesses need to integrate more applications.

"With the addition of FuseSource to our middleware portfolio, we will enable customers to experience greater integration capabilities and flexibility," he said. "FuseSource's technologies, expertise and commitment to open source make them a great fit."

Red Hat predicts buying FuseSource from Progress, based in Bedford, Mass., won't materially affect its finances in fiscal 2013.

Shares of Red Hat, based in Raleigh, N.C. fell 20 cents to close at $54.42 Wednesday before the announcement. The stock rose 2 cents after hours.

Shares of Progress Software, which reported Wednesday that it lost $1.9 million in its second quarter, compared with earnings of $18 million a year earlier, while its revenue fell to $114.6 million from $134.7 million, rose 61 cents to close at $19.90. Shares of Progress rose another 10 cents after hours.

Progress said Wednesday that it is executing a new strategy and will sell 10 non-core product lines, including FuseSource, buy back shares and cut its annual costs by $55 million. Progress expects the sale of FuseSource to close during its fiscal third quarter, which started June 1.

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