Red Hat shares up on speculation of Oracle deal

BOSTON (Reuters) - Shares of Linux software provider Red Hat Inc RHT.N climbed 10 percent on Monday and analysts said that investors were betting that the company would be acquired by Oracle Corp ORCL.O.

Officials with Red Hat and Oracle declined comment.

Investors have long speculated that software giant Oracle would one day buy Red Hat, which sells subscriptions to maintain services for its version of the open-source Linux operating system.

Jefferies & Co analyst Katherine Egbert said the speculation surged on Monday, but that she believed the timing was not right for a deal.

“Oracle does not have a history of purchasing still-fast-growing companies,” she said in a note to investors.

Shares of Raleigh, North Carolina-based Red Hat rose 9.9 percent to close at $16.37 in heavy New York Stock Exchange trade. Trading in options of Red Hat, the biggest publicly held provider of the Linux operating system, was also heavier than usual.

“The volumes of stock and options suggest that there are institutions aplenty taking this rumor seriously,” said Jon Najarian, a founder of Web information site

Shares of Redwood City, California-based Oracle, the world’s largest publicly held maker of business software, rose $1.15 or 6.7 percent to close at $18.25 on the Nasdaq.

Reporting by Jim Finkle in Boston and Doris Frankel in Chicago, editing by Matthew Lewis