Rising on the cloud
Powerful partnership
"Combining IBM’s portfolio and expertise with HashiCorp’s capabilities and talent will create a comprehensive hybrid cloud platform designed for the AI era."1
Arvind Krishna
Chairman and CEO
IBM
Identifying
opportunity
The rise of generative AI has only heightened the accelerating demand for scalable, secure, and automated infrastructure solutions—spanning both cloud and on-premises environments. As organizations deploy AI across their operations, they face a surge in cloud workloads and increasingly complex infrastructure strategies. IBM is innovating to support clients at this inflection point.
IBM identified HashiCorp as a strategic fit with its business model, recognizing the potential for strong synergies. With its roots in open-source software, HashiCorp offers tools that automate and secure multi-cloud and hybrid environments—capabilities that complement IBM’s own focus on hybrid cloud and AI. Its flagship product, Terraform, is considered the industry standard for infrastructure-as-code, used by 85% of Fortune 500 companies and more than 4,400 clients globally. HashiCorp’s automation and developer-first approach aligns with IBM’s open-source strategy, partnerships with hyperscale cloud providers, and previous acquisitions.
To support this acquisition, IBM appointed RBC Capital Markets as financial advisor on the transaction.
Accelerating
strategic support
RBC Capital Markets worked alongside IBM on key aspects of the HashiCorp acquisition, including diligence around execution planning and stakeholder considerations. RBC specialists also collaborated with IBM to shape the strategic narrative around the deal. This included advising on how best to communicate the rationale to investors and broader public audiences.
Valued at $6.4 billion, or $35 per share in cash, the proposed acquisition marks one of the largest in IBM’s history—second only to its landmark $34 billion acquisition of Red Hat in 2019. Notably, RBC Capital Markets also played a role in that transaction, serving as joint bookrunner on the $20 billion senior unsecured notes offering used to finance the deal.
As a trusted advisor, RBC has a long-standing relationship with IBM, built on the expertise of its Technology Investment Banking specialists and a track record of supporting the company’s evolving strategy in a fast-changing market. RBC has advised IBM across a range of treasury and capital markets activities, including debt and equity capital management, risk solutions, M&A, and cash management.
Rising on the cloud
Positioned for growth
“IBM’s leadership in hybrid cloud, along with its rich history of innovation, make it the ideal home for HashiCorp as we enter the next phase of our growth journey.”1
Dave McJannet
CEO
HashiCorp
Executing
for success
For IBM, acquiring HashiCorp enhances its ability to help clients automate workloads across diverse environments—spanning hyperscale cloud providers, private clouds, and on-premises infrastructure. The deal strengthens IBM’s standing in a cloud market valued at $1.1 trillion in 2023 and projected to grow at a high-teens CAGR through 2027.
The acquisition is expected to drive meaningful near-term margin expansion for HashiCorp, supported by IBM’s scale and operational efficiencies. IBM’s stated ambition is to “infuse HashiCorp technology into every data center,” embedding its capabilities as a foundational layer across enterprise IT. Financially, IBM anticipates the transaction will be accretive to adjusted EBITDA within the first full year and to free cash flow by the second.
As IBM’s second-largest acquisition to date, the transaction positions the company to scale more effectively across the rapidly evolving markets of hybrid cloud and generative AI. By bringing HashiCorp’s automation and infrastructure-as-code expertise into its broader portfolio, IBM is better equipped to support clients building the complex infrastructure needed to deploy AI at scale. The deal also reinforces IBM’s broader strategy, which continues to deliver: recent quarterly performance showed double-digit revenue growth in software, and the company is targeting at least 5% revenue growth and approximately $13.5 billion in free cash flow in 2025.²