Red Hat buys JBoss

Red Hat Inc. will acquire JBoss Inc. in a $350 million cash and stock transaction.

In addition to the initial payment, the Raleigh, N.C., company plans to pay about $70 million more subject to the achievement of certain performance measures. The transaction is composed of about 40 percent cash and 60 percent stock.

Red Hat expects to complete the transaction next month.

JBoss of Atlanta provides open source middleware that connects otherwise separate applications.

By acquiring JBoss, Red Hat hopes to accelerate the shift to service-oriented architecture by enabling the next generation of Web-enabled applications to run on a low-cost, open source platform, the company said in a statement announcing the purchase.

Red Hat furnishes Linux and open source solutions to the commercial and government sectors. The company has more than 900 employees and had annual sales of $196.5 million, according to Hoover's Online of Austin, Texas.