Raleigh-based Red Hat Inc. will be bought by IBM Co. in a deal worth $34 billion, according to joint statement made by the companies Sunday.

IBM will buy all of Red Hat’s shares in cash at $190 each.

Red Hat will join IBM as a unit of its hybrid cloud team. Red Hat will continue to be led by CEO Jim Whitehurst, who will report to IBM CEO Ginni Rometty.

With this acquisition, Red Hat hopes to reach to a wider audience, which will give the company a greater level of scale, resources and capabilities to accelerate the impact of open source as the basis for digital transformation.

According to the news release, the deal, which is IMB’s biggest deal to date, will accelerate IBM’s revenue growth, gross margin and free cash flow within 12 months of closing as well as support a solid and growing dividend.

“IBM is committed to being an authentic multi-cloud provider, and we will prioritize the use of Red Hat technology across multiple clouds” said Arvind Krishna, senior vice president of IBM Hybrid Cloud, in a statement. “In doing so, IBM will support open source technology wherever it runs, allowing it to scale significantly within commercial settings around the world.”

Red Hat provides software for operating systems, cloud storage and other computer functions. It distributes Linux, which works to translate requests from all other software on a computer to the computer’s hardware.

As of Aug. 31, the company has reported about 12,600 workers worldwide. The (Raleigh) News & Observer reports that the company has more than 2,000 employees at its tower in downtown Raleigh.

The software company reported revenue lower than expectations for its second quarter and projected lower-than-expected results for the current quarter.

IBM manufactures and markets computer hardware, middleware and software and provides hosting and consulting services. According to the release, the deal will accelerate IBM’s high-value business model, making the company the leading hybrid cloud provider in an emerging $1 trillion growth market.

The acquisition has been approved by the boards of directors of both IBM and Red Hat and is subject to Red Hat shareholder approval as well as regulatory approvals and other customary closing conditions.

It is expected to close in the latter half of 2019.

As of the market’s close on Oct. 26, IMB stock is worth $124.79. Red Hat shares are currently being traded at $116.83.